Key Considerations and Reminders for Estate Planning

Some important thoughts and reminders in regard to estate planning:

• Understanding the importance:  Estate planning often sits at the bottom of people’s to-do lists, yet it plays a crucial role in securing your family’s financial future and helps ensure your loved ones and favored organizations are provided for.  Without a proper plan in place, the legal system decides how your assets are distributed, which is costly and can cause problems.  Remember, oral promises are not binding.

• Estate plans are beneficial for everyone:  Planning ahead can help you avoid family conflicts, unexpected or disproportionate taxes, higher estate costs and other potentially undesirable consequences.  Minimize challenges later by facing the important aspects of estate planning now!

• Sooner is always better:  No matter what your stage of life, the time to create or revise an estate plan is now. Making a plan when you’re healthy and without a looming emergency gives you time to explore all your options and make calm, rational choices.  If you wait too long, you might miss the opportunity to plan at all! 

• Estate planning isn’t an event, it’s a process.     There are some important things to consider in relation to naming agents, beneficiaries, amounts vs. percentages, etc.  Discussing these things and putting an estate plan in place is one step; after that, make sure that your plan keeps pace with your life.  Review your legal documents (will, trust, powers of attorney & beneficiary designation forms) on a periodic basis (and with events such as marriage, divorce, birth of children, a death or the passage of new legislation that may impact planning) so that documents continue to reflect your wishes over time.

• You don’t have to do it alone and you shouldn’t.   Your professional team can help you navigate the process, tailor you plan and achieve your goals.  Perspective can come from a team of advisors to help you address/analyze income sources, retirement/investment accounts, beneficiary designations, insurance needs, tax efficiency, charitable giving options and trust structures that best meet your needs.  Your team should have an understanding of your goals and philosophy.  Be sure to explain what you want to accomplish with your estate plan and don’t be afraid to ask your advisors questions…

• Discuss your options before you do something.   A small mistake can change your estate plan and with it your legacy.   A misplaced word or miscommunication can be detrimental.  Get advice before taking any action that could trigger a large gain. You can discuss your options before you do something but not after a sale. 

• Are your wishes known and understood?  If not, take steps to ensure that you discuss and share relevant information and plans with advisors, executors, agents, family and perhaps even your doctor. 

• Planned gifts have a major impact on a non-profit’s ability to support the future of their mission and this will continue to be the case.  They can also be a win-win.  You may be able to enhance both what named heirs and charity receive by strategically selecting which assets go to each.  Remember that you want your estate plan to reinforce core values and not just shift money.  Do any named charities know they have been named?

• Have you carefully considered various beneficiary designations and how that will play out?  Will a beneficiary incur a lot of taxes that limit what you pass on to them?  Do you know what happens if one or more of your named beneficiaries are no longer alive?

• Have you safeguarded your important legal documents?  Do agents have a copy of what they need or does someone have access? Are they able and willing to serve?  Are they the best choice?  Have you named an alternate?  Have you named co-agents that will make matters difficult?  Are your legal documents secure?

• Have you addressed any personal mementos and effects?   Pets?   Sometimes personal mementoes and effects, even when they have no real financial value, can cause estate disputes. Other times, your heirs don’t want a lot of these things and resent being left sorting through them. Your estate plan can help address how any such assets will be distributed or otherwise dealt with and this does not have to be complicated.