In the estate planning world, there are numerous tips that I could endlessly write on. To narrow it down to just ten tips was difficult to say the least so please know the purpose of this is not a complete guide to estate planning but rather just a few things to think about when beginning to plan or, if you have a plan, a few tips that hopefully add value to your existing arrangements. Don’t miss the bonus tip within the article; it’s one of the most important!
1. Start planning
The first tip is simply to take the initiative and if you are reading this, then you already have! The usual excuses such as, “I’m not going to die,” “I don’t like to think about it,” “I am too busy to plan,” and “I am too young to think about it” must be dismissed. Death is unavoidable! No one knows exactly when their time will come but being prepared, taking part in the planning while you can, is empowering and provides you the peace of mind you deserve.
Do not allow pride and misconceptions to leave your estate in shambles or worse, force family members to sift through it all during the grieving process. Planning your estate includes, but is not limited to:
- Meeting with a professional who is willing to educate you
- Taking inventory of your assets and liabilities
- Determining your beneficiaries
- Deciding who will manage the plan
- Deciding who will be your Power of Attorney & Health Care Surrogate
- Deciding who will be your children’s guardians (if applicable)
“You can’t plan for death after you die!”
2. Don’t draft any documents yourself
When it comes to your life, your property, and your legacy do not entertain the possibility of making critical errors. Meet with an estate planning attorney to ensure your documents are valid, accurate, and precise. Your estate planning attorney will draft your documents, ensuring they:
- Are valid and sound according to Florida law
- Accurately reflect your wishes and inventory
- Correctly define your intentions for the treatment of yourself and the disbursement of your property
The entire plan is crucial for deciding your health treatment and ensuring your assets are protected when you are not able to do so. If you do not draft the forms correctly or understand certain clauses, when the time comes, it will be too late for you to correct them because you will be dead or incapacitated. Consult an attorney to protect your legacy and eliminate uncertainty.
“You don’t know what you don’t know!”
3. Talk with your significant other about estate planning
Discuss the possible outcomes with your significant other for what would happen if you pass before they do. If you are married, most likely guardianship of your shared children and all of your property and finances will transfer to your surviving spouse unless otherwise noted. Things become more complicated if you have children from multiple partners so seek professional advice on the topic. If your spouse gets in an accident, you want to make sure your assets such as a life insurance policy are protected accordingly. Decide the role your significant other or appointed representative will play in deciding:
- Your medical care
- Post-life ceremonies
- Inheritance they will receive/oversee
Plan for the possibility that both you and your spouse will pass. Discuss who should inherit your children and property. Make all intentions known, and address every topic. The conversations may be difficult but are worth having! You will literally sleep better at night knowing that you have taken the correct steps to protect your assets and family.
4. Establish who gets what
In your estate plan you should account for:
- All property (personal and real)
- Bank accounts
- Insurance policies,
- And anything else in your name
After taking note of the above, you should then decide who will be the beneficiaries of all those assets and things. Guardianship of children must be awarded if there are surviving minors. Figure out what means of distribution work best in your favor. Many times a trust is a smooth transition with cost-effective savings and asset protection against creditors.
5. Choose exactly how your estate should spend your money
Be specific when allocating funds. Decide if you want money spent on funeral ceremonies, donated to charities, inherited directly, or all the above. The money in shared bank accounts and trusts will remain in control of the joint-owners but will be subject to their creditors and yours. Other funds and assets may also distribute through trusts or a will. The questions you want to answer when it comes to disbursing finances are:
- What finances need addressing?
- Who receives them?
- How exactly will they be distributed?
- When will the beneficiaries be given these assets?
6. Minimize estate and income taxes
Taxes can be avoided or minimized by consulting an estate planning attorney. An experienced attorney can direct you toward the most beneficial methods of distributing property to maximize your financial savings. There are plenty of opportunities to ensure that beneficiaries receive the highest possible percentage of their intended inheritance. Failing to do so will result in your hard earned money being spent on such services after you pass away. It’s your family that suffers at the expense of your estate to protect them while you still can!
7. Seek the guidance of professionals
The help of the right professional should save you time and money. Take advantage of tax loopholes that you did not realize existed by seeking advice from attorneys, financial planners, and tax experts. Additionally, they should be able to advise you on asset protection measures that will protect your beneficiaries inheritances from potential or existing creditors. These professionals will be worth your money because they should save you and your family money, time, and frustration. When hiring these professionals, look for someone who:
- Stays up to date in their industry through continuing education programs
- Focuses on educating you and your family, allowing you to be more informed of what you are getting from them and what is available in the marketplace
- Genuinely care about you and your family rather than just your money
Hire professionals to get the peace of mind you deserve, knowing that everything was done correctly!
8. Plan for more than just asset distribution
Estate planning does not only consist of asset distribution. Your attorney should discuss a power of attorney for managing your finances during incapacitation and in the case of death (durable power of attorney), health care surrogate documents which appoint a representative to make healthcare decisions on your behalf, guardianship of minor children, and living wills for specific wishes that need completion on behalf of an individual. There is so much more to plan for other than inheritance. Ensure your children and finances are in good hands by deciding now, while you still can!
9. Avoid probate as much as possible
Probate is the court process through which a will is proven. Trusts generally avoid probate and thus save your estate money as well as have other benefits. Probate court costs and attorney fees can be very expensive. Many of these fees and taxes can be avoided to ensure your beneficiaries maximize their inheritances. To steer clear of the long and costly probate process, talk to your estate planning attorney to take advantage of all the money-saving products they can provide.
10. Plan your memorial
One of the hardships family and friends must overcome while dealing with the loss of a loved one is trying to decide how to plan the memorial service. After your death, your family will be grieving. The planning along with financial burdens of a memorial service will surely add to their troubles. To help prepare your loved ones for the days when you are no longer with them, it is encouraged to plan your services in advance. You will be able to dictate the ideal ceremony for yourself while giving the ones you care for the comfort of not having to wonder what is best. We recommend pre-paying for your ceremonies to alleviate much of the financial burden. Service providers such as Baldwin Cremation do a fantastic job in offering this type of planning! Things you should consider are:
- Whether you would like to be cremated or buried
- If there will be any religious ceremonies
- Where your final resting place will be
** BONUS TIP: Make Sure Your Documents Can Be Located
The worst case scenario for estate planning is that you do all of the work, commit the time, pay fees, and complete all the documents only to have the records disappear when it is time to utilize them. A missing will can be chaotic for surviving relatives and could create tension within the family. To avoid losing your essential documents, it is recommended to have one copy of your estate plan on file with your attorney, as well as having another copy of the documents kept in a vault or safe. You would also want to send a notice to any close relatives or friends and to your attorney informing them of the location you keep the documents. You want all the planning to be worthwhile by ensuring all relevant material can be located when needed. Your attorney should help you with all this and be able to provide forms to make this process easier.
If you liked these tips please share with friends! Whether you come to The Finity Law Firm or not, we truly want you to be informed and for your family to be protected. If there is anything we can help with please set up your FREE consultation by calling us at (407) 636-4066, emailing us at email@example.com, or filling out our contact form HERE.