4 Reasons Why Estate Planning Isn’t Just for Rich People

There is a common misconception that estate plans are only for the ultra-rich. This includes the top 1 percent, 10%, 20%, or some other arbitrary determination of “enough” money.  In reality, nothing could be further from the truth. People at all income and wealth levels can benefit from a comprehensive estate plan. Sadly, many have not sat down to put their legal house in order. That is why it’s important to know that estate plans are not only for the rich.

According to a 2016 Gallup News Poll more than half of all Americans do not have a will, let alone a comprehensive estate plan. These same results were identified by WealthCounsel in its Estate Planning Awareness Survey. Gallup noted that 44 percent of people surveyed in 2016 had a will in place, compared to 51 percent in 2005 and 48 percent in 1990.  Also, over the years, there appears to be a trend of fewer people even thinking about estate planning.

Top Four Reasons

When it comes to estate planning, the sooner you start the better. Below are four reasons why everyone – no matter what income or wealth level – can benefit from a comprehensive estate plan:

1. Forward Thinking Family Goals

Proper estate planning can accomplish many things. The first step is to ask what your goals are. They may include caring for a minor child, an elderly parent, a disabled relative, or distributing real and personal property to individuals who will appreciate and maintain these assets prudently.  

Understanding what your family wants and needs are for the future is a great starting point for any estate plan. If you can sit down and spend time planning your vacation, you can do the same for your estate. Your future self, and your loved ones, will thank you.

 

2. Financial Confidence Now and After You Are Gone

One immediate benefit of having a finished estate plan in place is that you will likely feel in control of your finances, possibly for the first time ever. Many people experience a new sense of discipline in maintaining their finances. This can help with saving for retirement, a big purchase, or other goal.

 In addition to the personal benefit of financial control, an estate plan allows you to dictate exactly how and when your heirs receive an inheritance. This is particularly important for minor heir or those who need additional guidance to manage their inheritance, like a disabled child.

 

3. Identify Risks

An important aspect of a good estate plan is to mitigate against future and current risks. One example is becoming disabled and unable to support your family. Another is the possibility of dying early.

Through an estate plan you can chose who will be in control of your personal assets, instead of the court appointing a legal guardian who will cost money and be a distraction for your family.  While contemplating these types of risks is never fun, preparing ahead of time ensures your loved ones will be prepared if an unfortunate tragedy occurs.

 

4. To Maintain Your Privacy

In the absence of a fully funded, trust-based estate plan, a list one’s assets are available for public view upon death. This occurs when a probate court needs to step in. Probate is the legal process by which a court administers the deceased person’s estate. A solid estate plan should generally avoid the need for involvement by the probate court, so your family’s privacy can be maintained.

 

The Bottom Line: Seek Professional Advice

There are numerous benefits to working with a professional team when it comes to estate planning. Estate planning attorneys, financial advisor, insurance agents, and others have a broader and deeper knowledge of money management, financial implications, and the law.

When you work with a qualified team to implement an estate plan you can rest easy knowing your family will be taken care of no matter what happens in the future. Contact us today to learn more about how we can help with your estate plan.

/0 Comments

3 Tips For Every New Homeowner

Congratulations on the purchase of your new home.  Whether this is your first home or an upgrade/downsize, the purchasing of a home is a big event in your life.  When these major life changes occur, it is important that you are properly prepared. Below are a few things for you to consider now that you finally have the keys to your new home!

Update Your Address

Now that you are in your new home, it is very important that you update your address with the appropriate entities. Your local United States Postal Office will have a form you can fill out. If you cannot make it to the post office, you can also update this information on their website. This will assist them in forwarding your mail to you.  

To ensure that you don’t miss any important tax notices or refunds, you will also want to update this information with the Internal Revenue Service, using Form 8822, and your local state tax agency.

Make Sure Your House Title Coordinates With Your Estate Plan

While it is still fresh in your mind, reference your new deed to see how the property is titled.  Then, you will want to reference your estate planning documents to make sure that your property has been titled properly to achieve your estate planning goals.

For example, suppose your previous plan had a specific provision distributing your old property. In that case, you will want to make sure that you update this provision since you no longer own the previous property. On the other hand, if this is your first home and your estate plan includes a trust to avoid probate, you will need to make sure that your home was titled in the name of the trust and not in your name individually.

Check Your Life Insurance Coverage and Beneficiary Designations

Unless you were fortunate enough to pay cash for your new home, you now have a large monthly mortgage expense. In order to protect your loved ones, it is important that you check your life insurance coverage. Should you die before paying off the mortgage, it is a good idea you have enough life insurance to meet that obligation should you have a surviving spouse or children that will likely continue to reside in the home. Even if they choose to not remain in the home, life insurance can provide valuable assets during what is usually an emotionally difficult time.

This is also a great opportunity to double-check your beneficiary designations. Life changes happen so quickly that sometimes this can be overlooked. If your designations do not match up with the rest of your estate plan, you may end up inadvertently disinheriting a family member or having the money fall directly into the hands of an individual without any guidance.

Lastly, now that you have home and homeowner’s insurance, call your insurance agent to make sure that you are getting all of the discounts that you are entitled to.  Many insurance companies will offer discounts when you bundle services. If you already have car insurance through a carrier and use the same company for your homeowner’s insurance, you may be entitled to a better rate than if you had both policies separately. In addition, homeowners often get discounts that renters don’t.

Buying a new home is a big step and we are here to help. Contact us or give us a call and we can help make sure that your new purchase and estate planning are working together to carry out your goals.

/0 Comments