ESTATE PLANNING ESSENTIALS
ESTATE PLANNING ESSENTIALS
WHAT IS ESTATE PLANNING?
Estate planning is the process of designating who will receive the assets you have worked so hard to accumulate during your lifetime or if you are incapacitated. The goal of estate planning is to ensure your wishes are met by beneficiaries receiving assets in a way that minimizes estate tax, gift tax, income tax and other taxes.
Estate planning can help establish a platform you can fine-tune and update as your personal and financial situations change. The critical question to ask yourself is: How do you want your assets managed if you become incapacitated and distributed when you die?
WHAT IS ESTATE PLANNING?
Estate planning is the process of designating who will receive the assets you have worked so hard to accumulate during your lifetime or if you are incapacitated. The goal of estate planning is to ensure your wishes are met by beneficiaries receiving assets in a way that minimizes estate tax, gift tax, income tax and other taxes.
Estate planning can help establish a platform you can fine-tune and update as your personal and financial situations change. The critical question to ask yourself is: How do you want your assets managed if you become incapacitated and distributed when you die?
KEY TAKEAWAYS OF ESTATE PLANNING
- Estate planning is not only for the wealthy—everybody can benefit from working with an experienced estate planning attorney to ensure their assets and finances are properly taken care of after their death.
- Without the proper planning and documents, probate court may lead to the unintended distribution of assets.
- Estate planning gives family members or a fiduciary permission to carry out your wishes if you become incapacitated.
KEY TAKEAWAYS OF ESTATE PLANNING
• Estate planning is not only for the wealthy—everybody can benefit from working with an experienced estate planning attorney to ensure their assets and finances are properly taken care of after their death.
• Without the proper planning and documents, probate court may lead to the unintended distribution of assets.
• Estate planning gives family members or a fiduciary permission to carry out your wishes if you become incapacitated.
WHY IS ESTATE PLANNING IMPORTANT?
Having a comprehensive estate plan in place can help you feel more confident about your future and that your loved ones will be taken care of. It can help you achieve a variety of goals and objectives including:
- Providing support and financial stability for your spouse and children
- Preserving assets for future generations
- Supporting favorite charities and causes
- Ensuring all of your assets, including those that pass by beneficiary designation, will be distributed according to your wishes.
- Minimizing taxes and expenses
- Ensuring that individuals you choose can make decisions on your behalf in the event of your incapacity
WHY IS ESTATE PLANNING IMPORTANT?
Having a comprehensive estate plan in place can help you feel more confident about your future and that your loved ones will be taken care of. It can help you achieve a variety of goals and objectives including:
• Providing support and financial stability for your spouse and children
• Preserving assets for future generations
• Supporting favorite charities and causes
• Ensuring all of your assets, including those that pass by beneficiary designation, will be distributed according to your wishes.
• Minimizing taxes and expenses
• Ensuring that individuals you choose can make decisions on your behalf in the event of your incapacity
5 ESTATE PLANNING MUST-HAVES
Here is a list of items every estate plan should include:
1. Trust and/or Wills
2. Durable Power of Attorney
3. Beneficiary Designations
4. Healthcare Power of Attorney
5. Nomination of Guardians
1. Wills and Trusts
A will or trust should be one of the main components of every estate plan, regardless of your current wealth. Wills ensure property is distributed according to an individual's wishes and must be drafted according to state laws. Trusts avoid probate and can help limit estate taxes and legal challenges. However, a will or trust is just one piece of an estate plan and documentation.
2. Durable Power of Attorney
It is important to draft a durable power of attorney (POA), so an agent or a person you assign will act on your behalf when you are unable to do so yourself. Absent a power of attorney, a court may be left to decide what happens to your assets if you are found to be mentally incompetent, and the court's decision may not be what you wanted.
3. Beneficiary Designations
It is important to maintain a beneficiary – and a contingent beneficiary – on your retirement accounts. If you don't name a beneficiary or the beneficiary is deceased, a court could be left to decide the fate of your funds.
4. Healthcare Power of Attorney
You should assign a healthcare power of attorney (HCPA) to designate another individual (typically a spouse or family member) to make important healthcare decisions on your behalf in the event of incapacity. You may want to pick someone you trust, who shares your views, and who would likely recommend a course of action you would agree with. You should also identify a backup agent in case your initial pick is unavailable or unable to act at the time needed.
5. Nomination of Guardians
If you have minor children or are considering having kids, picking a guardian is incredibly important and sometimes overlooked. Make sure the individual or couple you choose shares your views, is financially capable and is genuinely willing to raise children. As with all designations, a backup or contingent guardian should be named as well.
5 ESTATE PLANNING MUST-HAVES
Here is a list of items every estate plan should include:
1. Trust and/or Wills
2. Durable Power of Attorney
3. Beneficiary Designations
4. Healthcare Power of Attorney
5. Nomination of Guardians
1. Wills and Trusts
A will or trust should be one of the main components of every estate plan, regardless of your current wealth. Wills ensure property is distributed according to an individual's wishes and must be drafted according to state laws. Trusts avoid probate and can help limit estate taxes and legal challenges. However, a will or trust is just one piece of an estate plan and documentation.
2. Durable Power of Attorney
It is important to draft a durable power of attorney (POA), so an agent or a person you assign will act on your behalf when you are unable to do so yourself. Absent a power of attorney, a court may be left to decide what happens to your assets if you are found to be mentally incompetent, and the court's decision may not be what you wanted.
3. Beneficiary Designations
It is important to maintain a beneficiary – and a contingent beneficiary – on your retirement accounts. If you don't name a beneficiary or the beneficiary is deceased, a court could be left to decide the fate of your funds.
4. Healthcare Power of Attorney
You should assign a healthcare power of attorney (HCPA) to designate another individual (typically a spouse or family member) to make important healthcare decisions on your behalf in the event of incapacity. You may want to pick someone you trust, who shares your views, and who would likely recommend a course of action you would agree with. You should also identify a backup agent in case your initial pick is unavailable or unable to act at the time needed.
5. Nomination of Guardians
If you have minor children or are considering having kids, picking a guardian is incredibly important and sometimes overlooked. Make sure the individual or couple you choose shares your views, is financially capable and is genuinely willing to raise children. As with all designations, a backup or contingent guardian should be named as well.
THE BOTTOM LINE
Our estate planning attorneys ask the right questions upfront so that they can safeguard your wealth and preserve your legacy for generations to come.
We have the expertise and skill to create plans from the relatively straightforward to the complex, including business succession strategies, intricate wealth transfers, special needs planning and charitable gifting. Our trust and estate planning lawyers at both our Pasadena and Westlake Village offices will guide you every step of the way.
THE BOTTOM LINE
Our estate planning attorneys ask the right questions upfront so that they can safeguard your wealth and preserve your legacy for generations to come.
We have the expertise and skill to create plans from the relatively straightforward to the complex, including business succession strategies, intricate wealth transfers, special needs planning and charitable gifting. Our trust and estate planning lawyers at both our Pasadena and Westlake Village offices will guide you every step of the way.
Serving Southern California, including Pasadena, La Canada, Glendale, Burbank, Calabasas, Westlake Village, Thousand Oaks, Simi Valley, Camarillo and beyond.
