A good estate plan will protect you, your privacy, your dignity, your property, and your loved ones. It will help preserve your wealth by avoiding unnecessary probate administration, unnecessary estate taxes, and unnecessary acceleration of income taxes.
So, what constitutes a good estate plan? The answer is “A plan that works best for the individual, because what is good for one might not be good for another.”
Everyone wants to reduce or avoid legal fees, court costs, and taxes (estate and income). Also, many want to ensure the possibility to do Medicaid planning and want to make sure their property will stay in their family bloodline.
In order for these goals to be met, we use powers of attorney and properly funded revocable trusts. You also need to make sure the designations on life insurance, annuities and retirement plans are properly coordinated with the plan.
If you have not had your plan looked at in the past three years, or if you have moved here from another state, you should have your papers reviewed and updated. Laws change – and have changed – as do family and financial circumstances.
So, how should you get started?
• Identify your assets and their initial cost. What assets? Real estate interests, retirement accounts, life insurance, annuities, brokerage accounts, certificates of deposit, royalties, partnership interests … and the list could go on.
• Determine who owns each asset. Is it in your name alone? Is it in your spouse’s name alone? Is it in both names? All of these details can be a bit overwhelming if you try to do it yourself. That is why you need professional assistance.
• Determine which people you trust the most to handle your financial affairs and to make medical decisions for you in the event you are incapable of making such decisions. Consider alternates.
• Determine which people you want to benefit.
• Make an appointment with an estate planning attorney. Make sure the person you choose is well qualified and experienced to handle these matters for you.
If they have earned an advanced legal degree in the subject of estate planning, that is a good indication that they are well qualified. If they have engaged exclusively in estate and asset protection planning for more than 10 years, they have sufficient experience. Learn how they perform their service. Find out exactly what is included in the service.
As an example, here’s what an experienced estate planning attorney offers: Each representation usually involves three to four in-person meetings. The first meeting (complimentary) allows the attorney to learn about your family and your objectives. The client will get an idea of the basic plan and a projected fee.
The second meeting is to review a draft of the papers. A telephone conference follows, to address questions, concerns and to make desired adjustments. There is a final meeting to get the papers signed and make sure all assets are titled properly, and designated properly to work optimally with the plan.
A solid plan is vital to protecting your estate and your family. Choose wisely when selecting your estate planning attorney.
Mark F. Winn, J.D., Master of Laws (LL.M.) in estate planning, is a local asset protection, estate and elder law planning attorney. mwinnesq.com