Once you have a general idea of how you\u2019d like your assets to be handled upon your death; it\u2019s time to put it in writing.\u00a0 I recommend hiring an attorney who can draw up all of the legal documents for you.\u00a0 Yes, you could use a site like Legal Zoom, but I recommend using an actual person.\u00a0 A skilled attorney in the area of estate planning knows the ins and outs of estate plan design and can provide the right guidance in ensuring you\u2019ve covered all the bases.\u00a0 Having an actual conversation to discuss all of your options is extremely valuable.\u00a0 Just find someone who knows what they\u2019re talking about.<\/p>\n

Answer all the “What Ifs?”<\/b>\u00a0 After you\u2019ve mapped out your overall goals and you know what you\u2019d like to pass on to whom, ask some \u201cwhat if \u201cquestions.\u00a0 My goal may be to pass everything on to my husband, Jeff, first.\u00a0 Then if we both die at the same time to Luke and my step-children.\u00a0 What happens though if I die and then Jeff dies after me?\u00a0 My assets pass on to him based on my will but then become part of his estate and those assets would then pass according to his<\/i> will.\u00a0 So what does his will say? Or what if I die, Jeff remarries and then either dies or divorces?\u00a0 Without proper planning my assets could end up going to someone else (the new wife) and not at all to our children.\u00a0 The same type of questions would apply in the reverse.\u00a0 What happens to Jeff\u2019s assets if they become part of my estate? \u00a0We want to be sure that Jeff\u2019s intentions to have assets pass on to his children are retained.<\/p>\n

This part can get really mind boggling so don\u2019t be afraid to draw out a little flow chart or something.\u00a0 Our attorney was great about asking us all the \u201cwhat ifs\u201d.\u00a0 He raised some questions I hadn\u2019t considered.\u00a0 You want to be able to see your plan from all angles so you can address any potential pitfalls.<\/p>\n

Consider A Trust<\/b>\u00a0 Often times you\u2019ll find some type of trust utilized in an estate plan to help direct and protect how you want specific assets handled.\u00a0 In our case, since Luke is a minor, we\u2019ve included a testamentary trust.\u00a0 This type of trust is created upon our death with the provisions being spelled out in our will.<\/p>\n

The trust will hold Luke\u2019s assets until he reaches a certain age.\u00a0 What\u2019s nice about this handy tool, is that I can lay out some specifics rules.\u00a0 For example, we\u2019ve specified that the funds can be accessed for his education expenses, health expenses, and overall support expenses.\u00a0 What\u2019s considered as a qualified expense under those terms comes down to the discretion of the designated trustee, so keep that in mind when electing the trustee. \u00a0I\u2019ve drafted a letter with instructions to my trustee as to my overall intentions. It isn\u2019t legally binding, but if an expense were to be contested by someone, a judge may take the letter into consideration.\u00a0 Besides that it makes me feel better and my trustee appreciates my thoughts and guidance.\u00a0 I\u2019ve even provided contact information for my own financial planner whom I trust in helping my trustee manage the trust assets.<\/p>\n

Once Luke reaches 25, he\u2019ll receive half of the remaining trust assets.\u00a0 Then at age 30 the trust will terminate and he\u2019ll receive whatever is left.\u00a0 I could have chosen any age (after he becomes a legal adult) or any percentage at whatever intervals I wanted.\u00a0 With the provision for health, education, maintenance and support, he\u2019ll have access to the funds for what he needs including college expenses, but he won\u2019t be able to go blow it in Vegas.\u00a0 The age restrictions are simply to encourage him to be responsible with the money.\u00a0 If at age 25 he wants to go to Vegas, than he can.\u00a0 Of course my hope is that he\u2019s much more responsible and uses the money for something meaningful. \u00a0 See how helpful trusts can be?<\/p>\n

We could have also utilized a trust to provide the surviving spouse with a specific amount of money or access to funds for maintenance and support with a portion of the estate assets being protected to be passed on to the children.\u00a0 These types of provisions can ensure your estate intentions are maintained in cases where a surviving spouse might remarry.<\/p>\n

Pay Attention to Named Beneficiaries<\/b>\u00a0 Certain assets such as life insurance proceeds and retirement accounts like (IRAs and employer-sponsored plans) have named beneficiaries so you can specify who you want to receive those assets.\u00a0 These assets pass outside of the estate and aren\u2019t directed by the will.\u00a0 Since a large portion of our assets consist of life insurance and retirement accounts we\u2019re able to structure the named beneficiaries in a way that protects our intentions.\u00a0 For example, part of Jeff\u2019s assets specifically name his children guaranteeing they receive those specific assets while other assets will be passed on to me to help with my living expenses and provide for Luke. \u00a0\u00a0(So if you think you can have Jeff killed off, sweet-talk me into marrying you and then steal the family fortune, you\u2019re wrong. We’ve done our estate planning. \u00a0Not to mention our family fortune isn’t exactly a fortune.)<\/p>\n

Coordinate Titling of Assets\u00a0<\/b> It\u2019s important to make sure that the way your assets are legally titled match up with your overall estate plan.\u00a0 Having assets that are titled with \u201crights of survivorship\u201d mean that they pass on to the survivors directly without going through the estate process and aren\u2019t directed by the will.\u00a0 This can be helpful in providing immediate access to assets but it may not be the most tax efficient method depending on the type of asset and the relationship between owners.<\/p>\n

Other Considerations Not to Overlook \u00a0<\/b>When structuring your estate plan you\u2019ll also want to consider taxes.\u00a0 There are lots of strategies that can minimize or eliminate estate taxes in the event that your estate would be subject to taxes.\u00a0 (Most estates don\u2019t have to worry about that though, since only taxable estates worth more than $5.34 million this year are subject to federal estate tax.)\u00a0 Besides estate taxes there are also tax considerations when it comes to IRAs and stocks that will be passed on, so it\u2019s worth having a discussion with an estate attorney or financial planner.<\/p>\n

Finally, I would be amiss if I didn\u2019t mention (especially, living in this area) that if you have oil, gas and mineral rights you most definitely want to address that within your estate plan.\u00a0 I won\u2019t go into detail here, but it should definitely be discussed.\u00a0 Your estate may seem far away from exceeding the federal estate tax exclusion, but if you have large piece of property in an active production pool the value may represent the largest portion of your estate.<\/p>\n","protected":false},"excerpt":{"rendered":"

Once you have a general idea of how you\u2019d like your assets to be handled upon your death; it\u2019s time to put it in writing.\u00a0 I recommend hiring an attorney who can draw up all of the legal documents for you.\u00a0 Yes, you could use a site like Legal Zoom, but I recommend using an […]<\/p>\n","protected":false},"author":2,"featured_media":689,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","sharing_disabled":false,"spay_email":"","jetpack_publicize_message":""},"categories":[41,15],"tags":[45,52,51,53,46],"jetpack_featured_media_url":"https:\/\/sarahcarrfinancial.com\/wp-content\/uploads\/2016\/05\/Estate-Planning.jpg","jetpack_publicize_connections":[],"jetpack_shortlink":"https:\/\/wp.me\/p9rIpx-7m","_links":{"self":[{"href":"https:\/\/sarahcarrfinancial.com\/wp-json\/wp\/v2\/posts\/456"}],"collection":[{"href":"https:\/\/sarahcarrfinancial.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sarahcarrfinancial.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sarahcarrfinancial.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/sarahcarrfinancial.com\/wp-json\/wp\/v2\/comments?post=456"}],"version-history":[{"count":7,"href":"https:\/\/sarahcarrfinancial.com\/wp-json\/wp\/v2\/posts\/456\/revisions"}],"predecessor-version":[{"id":464,"href":"https:\/\/sarahcarrfinancial.com\/wp-json\/wp\/v2\/posts\/456\/revisions\/464"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/sarahcarrfinancial.com\/wp-json\/wp\/v2\/media\/689"}],"wp:attachment":[{"href":"https:\/\/sarahcarrfinancial.com\/wp-json\/wp\/v2\/media?parent=456"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sarahcarrfinancial.com\/wp-json\/wp\/v2\/categories?post=456"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sarahcarrfinancial.com\/wp-json\/wp\/v2\/tags?post=456"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}