Effective Estate Planning: Everything You Need to Know – Guest Post

Effective Estate Planning

For many people, estate planning may simply mean creating a will. There are even many who consider estate and trust planning as something done only by the most affluent people in society. But this is not true. Everyone needs to ensure proper will and estate planning to ensure that all their personal assets are distributed to their chosen heirs on their death. It is also crucial to do family estate planning to avoid unfortunate fights between your surviving family members with regard to your assets. There is also a widespread myth that you should consider legal estate planning only when you are nearing retirement. This is not true. In fact, this can even be counterproductive if you meet with some unpredictable accidents. It is always better to plan your will in advance to account for anything and everything that may happen in your life.

How to achieve an effective estate planning

Estate planning is a gargantuan task for everyone. There are a lot of deliberations and processes involved in estate planning. This is even more true when you are doing elder estate planning. You are at the twilight of your life and may want to do the best thing for your family. There are some simple estate planning strategies you can follow to have perfect and stress-free estate planning. These include:

Hire a good estate planning law firm

This is the most crucial step involved in effective estate planning. You may not be familiar with every minute aspect of estate planning, which makes it important to have the assistance of someone who does. A good lawyer for estate planning can help you navigate the complex world of elder law estate planning and aid you in distributing your wealth in the way you want. An experienced and skilled estate planning law firm like LUIS E. BARRETO & ASSOCIATES, P.A., can help you with all matters like estate planning and estate protection, elder law, and probate administration.

Record your wishes

You may have some specific ideas about what you wish to happen to all your properties once you die. It is important that you document them legally to avoid any confusion after your death. If you do not do this while you are alive, the state will be forced to decide for you. There are a few documents indispensable to estate planning. These include:

  • Living will that can help you accept or reject treatments when you are unable to communicate with others.
  • Health care proxy that will give a chosen person the power to make medical decisions on your behalf.
  • Financial power of attorney that can help you designate a person to make financial decisions in your place.
  • Insurance policies
  • IRAs and 401(k) accounts
  • Will
  • Trust

Assign guardians for dependents

If a minor or someone with a disability is dependent on you, you should appoint a guardian for them while estate planning. This will ensure that they are taken care of after your death. You should also discuss in length the guardianship aspects with the person chosen by you and your estate planning attorney. Try not to choose couples as guardians, as this can cause complications in the event that they divorce.

Estate planning and probate

Probate is an extremely challenging and taxing process that can take up a lot of your precious time. You will also need the expert opinion of an estate planning attorney. In some cases, you can even avoid this lengthy process. Take the advice of an experienced elder law estate planning firm like LUIS E. BARRETO & ASSOCIATES, P.A., to avoid such issues.

Plan for estate taxes

It is important to pay federal taxes within 9 months after your death. Since this is to be done in cash, there can be problems if your assets are not in cash. This might mean that you have to sell your property, like your home or some land that you actually intended to pass on to your family. Consult an expert tax professional who can work in collaboration with your lawyer for estate planning to devise a strategy suitable for you.

Consider trusts

Trusts are a good way to ensure that your heirs get the money you have saved for them. You will have complete control over how much money is placed in the trust, who receives it, and how it is distributed. If you just hire a lawyer who has experience in handling trusts and this planning, you can rest assured your trust money will go to the intended beneficiary.

Keep the beneficiaries informed

Whatever money you might have in your accounts with beneficiaries will be distributed to them on your death, even though you have specified otherwise in your estate plan. So, remember to keep all your beneficiaries in the loop about your legal planning and inform them of the changes you are planning to make.

Make plans to cover long-term care

Many people get worried about their assets depleting when they get a diagnosis requiring long-term medical care, and rightly so. Nursing home bills can make a serious dent in your wealth and can reduce the inheritance of your legal heirs. Make alternate plans with the assistance of an elder estate attorney to help you cover such costs.

Inform yourself about IRD

An IRD is a tax that is payable by individuals who inherit specific types of funds. These include income from savings bonds, sales commissions, or any other form of income you may have received if you were alive. Your heirs will be required to pay it once you pass away. Make sure your planning takes into account all these tax possibilities to reduce the burden on your heirs.

Remember your digital assets

In this modern world with the proliferation of digital devices, all of us have important and sensitive information stored on digital devices. During such planning, make sure to transfer the crucial papers and passwords to your beneficiary.

In Conclusion

Estate planning is an important part of everyone’s life, irrespective of the magnitude of their wealth. You should consider this planning early in your life to prevent any issues that might crop up regarding your assets.

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