Estate Planning Strategies to Protect Your Assets and Keep Money in the Family
Many think that estate planning is reserved only for the 1%. Wealthy people indeed have more assets to think about, but they are not the only ones that can benefit from estate planning. All of us want to pass our assets to our loved ones smoothly and ensure our possessions end up in the right hands. Estate planning is there so you can communicate your wishes, organize your finances and ensure everything after your passing is handled fairly. So if you want to protect your assets and age happily and healthily, here are the best estate planning strategies to consider:
Name key players
When you’re creating a will, you need to name an executor. And when you’re considering an estate plan, you need to decide who will help you fulfill your wishes after your death or when you’re incapacitated. Here’s who you need to appoint:
- Durable power of attorney—this person will make financial decisions when you’re unable to make them yourself, temporarily or permanently.
- Health care power of attorney—this person will make medical decisions when you’re unable to make them yourself, temporarily or permanently. This can be the same person from above or someone else.
- Guardian—this person will raise your children while they are minors and make decisions concerning their place of living, education and other activities.
When choosing people who will fulfill your wishes, you need to think long and hard about who you want. Once you figure everything out, draft the official document with their names, get it signed and notarized.
Minimize your tax burden
Taxes should be an important aspect of your estate plan. To minimize them and provide your beneficiaries with a low tax they have to pay after your passing, employ one of several estate planning tax strategies. Firstly, you can consider creating a trust which will help keep your assets safe in case of bankruptcy or divorce and provide income for your children. In case your surviving spouse remarries, a trust will ensure your kids don’t get left out in any way.
You can also seek legal advice concerning your estate. Getting personalized advice is crucial since the costs of estate planning depend from case to case. Debts and capital losses can greatly affect taxation so consult with professionals and see where you can find benefits.
Get the right insurance
To always keep your wealth safe, even in case of unforeseen events, you must have good insurance. However, there are so many insurance products on the market today that it can be hard to choose something that fits your needs. Don’t spend too much on a policy that doesn’t offer the coverage you require—it will leave you unprotected while costing you money. Instead of rushing to over-insure, do your homework, seek advice on policies and choose something that’s best for your particular situation.
Invest in ongoing support
One of the biggest mistakes you can make in estate planning is to create a plan and never revisit it. This is not good because all families go through changes in the number of beneficiaries and assets, but laws and regulations change too. It’s important to find experts who offer comprehensive estate planning services to support your estate planning in the long run. With them on your side, you can make regular updates in documents, investment strategies and wealth management and keep all your wealth protected safely within the family.
Consider aged care fees
The world population is living longer and longer each year, so you need to consider aged care when drawing up your estate plan. Aged care fees include accommodation, daily care, means-tested fees and additional service fees, and all of them are increasing constantly. So to keep yourself and your family protected, structure your investments so you can pay for your aged care without having to make lifestyle adjustments. For instance, increasing your Age Pension can help you retain a good amount of cash flow to keep all the services covered without having to burden your loved ones.
Take time to manage your wealth
Estate planning is also the perfect excuse to re-examine your life goals for retirement and make necessary changes. When accounting for all of your assets, you will notice whether there are some imperfections in your plan. Employ all the tools you can find to set goals, reignite your savings plans, come up with solutions and manage your investments.
Some estate planning elements are simple, but those like establishing trusts and naming people who you want to manage your wealth require experience and precision. However, with the help of trusted attorneys, you will create a perfect estate plan so you can live in peace.
About the author:
Mike Johnston is an avid blogging enthusiast and experienced freelance writer. He’s a regular contributor to numerous online publications where he writes about lifestyle, travel, and business.