What do Abe Lincoln, Bob Marley and Prince have in common?
You guessed it…they all died without a will.
But why?
Kiplinger’s article, “4 Strategies to Avoid an Estate-Planning Mishap,” says that their reasoning was the same as it is for most people: just “too busy.” They were busy with life’s daily demands on their time. Also, many people don't want to think about it or take the time to sit down and get it done.
People don’t realize how much can be accomplished in a very short time with an experienced estate planning attorney. Similarly, they also don’t understand the issues that can pop up if they don't have a plan in place.
While you may hear about income and investments at every turn these days, you may not hear about important topics like taxes, health care, asset protection and leaving a legacy for your family, friends, and charities.
Be certain that you’ve made every effort to express how you want your assets distributed when you die. Take a look at these four basic strategies and discuss them with an experienced estate planning attorney to help you avoid an estate planning mishap.
1. Get that will in place. A will directs your executor about your wishes and spells out how you want your assets distributed when you pass away.
2. Consider a living trust. This can protect your assets and can help your estate avoid probate. While you may believe you don't need a living trust, it can help make certain your assets are managed according to your wishes even in the event that you’re no longer able to manage them on your own. In addition, you can sign a health care directive and power of attorney so those you trust can make decisions about your physical and financial well-being. Finally, trusts are not public court records so your affairs remain private.
3. Title your accounts appropriately. Get that trust in place or set up a "transfer on death" designation. This lets assets pass directly to the beneficiaries named by the owner. Also, make sure you’ve properly named the beneficiaries and contingent beneficiaries on IRAs and other tax-qualified accounts.
4. Think about life insurance. A policy is used to provide a death benefit for your family and can augment the legacy you pass down. It can help cover final expenses—like funeral, burial and medical bills.
Do it now. Your picture on the five-dollar bill might be a nice lasting tribute, but your family will like a comprehensive estate plan much more.
Reference: Kiplinger’s (August 2016) “4 Strategies to Avoid an Estate-Planning Mishap”
