Maintaining your estate plan can feel overwhelming when faced with all the changes life can bring. Calling your attorney may not be your first instinct when you’re faced with a significant shift in income, investments, or employment, but consulting with us is a wise way to ensure your legal health is always maintained. Read on for five events that should capture your attention and prompt you to reach out to us for some personalized advice.
Strategies to Enhance Your Success
Estate planning is complex and continually evolving. Often, affluent families are “early adopters” of the newest and best estate planning strategies. Luckily, by working with us, you can benefit from the same estate planning strategies that affluent families do. Here are a few techniques we should discuss soon.
1. Maintain an up-to-date, trust-centered plan
The foundation of your estate plan must achieve your goals and needs. Wealthy people tend to utilize estate plans with all assets funded into or aligned with trusts. Not only should your estate plan be trust-centered, but it should also be continually updated as your life, family circumstances, and the law grow and change. Make sure your current estate plan always reflects your goals—a tried-and-true secret of the affluent.
2. Create special trusts for special assets
Wealthy people take advantage of the legal and tax opportunities presented by unique assets or investments. Many types of assets, such as IRAs, life insurance, business ownership, and more, require specialized planning to work properly in your estate plan.
If you’ve saved for retirement, you know the value of an IRA, a 401(k) or another retirement plan. You are probably also familiar with the beneficiary designations for these plans. But, you may not be familiar with a specialized trust, called a standalone retirement trust or IRA trust. This trust lays out exact instructions about where the money in your IRA will go after you’re gone. If you’ve seen substantial accumulation in your IRA, you may not want its entirety to be disbursed to a beneficiary all at once. You’ve worked a lifetime to save, and the IRA trust empowers you to protect what you’re leaving behind.
In a similar fashion, life insurance trusts give you more control over your life insurance benefits, allowing you to direct what occurs to your life insurance policy in more detail than is possible with a plain beneficiary form. It can be risky to name your minor children as the beneficiaries of your policy. If your children are not yet adults, the insurance company often requires a court-appointed guardian to receive the funds, a potentially costly and lengthy process. Many people may decide to leave the policy benefits directly to the children’s caretaker to avoid this guardianship issue. But, leaving the policy benefits to your children’s caretaker outright doesn’t ensure that the money is used for the benefit of your children. A life insurance trust can protect what you’re leaving behind and ensure it is used for the benefit of your beneficiaries.
Unlike a plain beneficiary designation, a trust also lets you designate specific uses for your money by your beneficiaries, such as educational funding. The wealthy don’t leave these things to chance and instead use proactive trust-centered planning to achieve their goals and protect their families.
3. Build a collaborative professional team
Wealthy people rarely plan and work with professionals in isolation. They know they can get better outcomes by meshing their legal, tax, and financial plans together. Rather than silo their strategies with various advisors, they ensure their team is optimizing their results through a collaborative approach.
As you build out your team, seek out professionals who are enthusiastic about working with one another across disciplines. The more visibility they have into one another’s strategies, the better they’ll be able to provide you with the best possible benefits. Call us today. We can discuss the best ways to put these and other estate planning approaches of the wealthy into action for you.
As the end of the year approaches and you begin to look back on 2018, what changes need to be reflected in your estate plan? Have you gotten married or divorced in the past year? Perhaps you’ve welcomed a new child or grandchild, or experienced a change in your health. So much can change in a year, and it’s important not to let too much time pass before those changes are reflected in your plan.
Just like you need to stay in regular contact with financial advisors, primary health care providers, and accountants, your estate plan will serve you best when it’s kept up to date with the changes that shape your life.
Strategic Planning Guidance in Light of the Midterm Results
Estate planning is meant to be an ongoing process, not a one-time transaction. In the same way that you never stop budgeting, saving, and investing as you go through life, it is also sensible to see estate planning as a lifelong project. Let’s look at some of the considerations you should make now that the 2018 midterm elections are in the history books.
What You and Your Family Need to Know
Receiving a health diagnosis or learning that you need to undergo major surgery can cause substantial disruption in your day-to-day life. During this time, the last thing you may want to think about is estate planning.
Although you may have many things going through your head at the moment, now is a crucial time to make sure your estate plan is in order. Proactive planning can help put your mind at ease and let you focus on your treatment. Let’s review your estate plan together to make sure each of the following important components is up to date and reflects your current goals and wishes.
New Choices and Opportunities for Tax Savings
Are you a business owner curious about the new Section 199A deduction?
Although the deduction became effective on January 1, 2018, guidance on how it would be calculated was delegated to the Internal Revenue Service (IRS) by Congress. For months, tax professionals and their clients were only able to speculate based on the text of the statute and had no specific guidance to work with.
New Developments in August 2018
Use This Time to Revisit The Parts of Your Estate Plan That Impact Your Children Most
With all the considerations about your children’s wellbeing weighing on your mind from day to day, it can be easy to forget about some of the most important factors in keeping them well cared for and secure: naming a guardian in your estate plan.
When was the last time you reflected on your selection of a guardian? If the answer is hard to pinpoint, it’s probably time to revisit this issue. Children change a lot from year to year as they mature from infants into their teenage years. Their care needs and who would make a good guardian can change over time as well. Is the person you previously appointed as their guardian still the best choice? Because your children’s lives are constantly evolving, something that worked even a few years ago may be out-of-date now.
Important Estate Planning Tips You Should Act on Now
Like all things, tax laws are constantly changing. Together, we need to respond quickly and strategically to the new developments in the tax law landscape. While you shouldn’t wait to review your estate plan in light of the passing of the Tax Cuts and JobsAct (TCJA), making a knee-jerk reaction is rarely the best course of action, either.
The best decisions are made when we carefully analyze all angles of your estate to come up with the best strategy for you and your family. The law’s benefits will accrue most for those who take a proactive approach rather than those who wait until the last minute. Here are several reasons the tax changes need to be top-of-mind:
Planning With an Aim Towards Building Unity
A will or trust contest can wreak havoc on families. The conflict can result in possibly irreparable resentment and loss of familial communication. Old rivalries and disputes can resurface during the trying time that occurs after the death of a loved one, especially a parent. But careful estate planning can help you substantially reduce the risk, or even avoid this problem entirely.
Let’s take a look at a few of the ways you can build your estate plan to minimize family conflicts after you’re gone.
Your 3-Step Guide to Creating an Informed Estate Plan
Are you concerned about any of your adult children? Estate planning can pose extra challenges for families with adult children struggling with addiction, marital issues, or irresponsibility with money. The last thing you want is for your wealth to end up having a negative impact on your child, or to see them squander their inheritance. Many parents are concerned about what they can do to shield an adult child who struggles with problems like these from bad decisions and bad people that could worsen their child’s situation.
This is often a hidden issue within estate planning conversations, as it’s a sensitive topic that can bring up painful memories or emotions. Some parents are apprehensive to discuss their troubled adult children with friends or colleagues because of its private nature and potential for judgment from those outside the family.