When you think of your passing you want to imagine a loving family benefiting from your legacy of hard work and careful saving. The last thing you want is for there to be a big hassle that causes family feuds and hard feelings. You can prevent this with careful estate planning. Here are three things you definitely want to avoid:
You want to keep your money in the family as much as possible, but you have probably heard about the heavy estate taxes your beneficiaries can be up for when you pass. This is especially true for the very wealthy. Thankfully, estate planning laws have been passed that remove these taxes, but only up to a certain amount.
Of course, these laws are always subject to change, so you should still plan to minimize or eliminate estate taxes for your heirs. There are several ways to do this, including gifting your money while you are alive, setting up an irrevocable life insurance trust, and even establishing residence in one of the 17 states that don’t have estate taxes.
As any estate lawyer can tell you, even the closest of families can be destroyed by family fights over an estate. You can minimize this risk by being even more thorough in your estate planning than you think you have to be. An estate lawyer can help you with this.
The biggest troubles occur when you are ambiguous in communicating your wishes. Not being clear in your will or neglecting to place assets in a trust could set up a fight in court. Plus, putting your assets in a trust will offer you more control over where they go.
Probate is the process whereby a will is reviewed by the court, debts are paid, and assets are legally distributed. It can be a lengthy process, sometimes lasting over a year. In addition to the frustration and confusion that probate can cause, it also comes with significant fees. To avoid this,put your assets in a trust. This will keep your estate out of probate, move things along more quickly, and save your beneficiaries money.
Above all else, putting together an estate plan requires organization and effort. It may take multiple trips to your lawyer to ensure that everything is clear and that there are no gaps or holes in your plan. Remember, the last great gift you can give your family is an easy transition of your assets.
Check out this article on how to protect your assets in the event of your death!