Looking for effective estate planning strategies? Here’s what you need to know.
By using effective estate planning strategies now, you can save your family time, energy, and money. With proper planning, your family will owe less money to legal fees and taxes. This means more of your estate gets transferred to your family, where it belongs. However, you shouldn’t make your plans alone; estate taxes are numerous and difficult to understand. The right strategy can minimize your exposure. Here are the top three most effective strategies for estate planning.
Personal Care
The first step to proper estate planning should be making sure you have coverage for your own care. In the event of a catastrophic injury or terminal illness, you want to know you have prepared well. This also holds true if you are no longer mentally competent. Having a plan in place to handle these situations well before they come to pass is essential.
Start by assigning a Durable Power of Attorney to help with financial affairs. Adding an Advanced Healthcare Directive can help with the medical side of planning. The Healthcare Directive will make sure you meet the appropriate HIPPA requirements.
Final Expenses
The goal of a successful estate strategy is to take care of your family. This means your family receives the largest amount of money possible. The less money tied up in the legal system or owed to taxes, the better for all those involved. But there’s one expense that comes before all of that.
One thing many people neglect to consider is funeral arrangements. This is something you will want to set aside money to cover. Many people also leave extra money to cover surprise expenses associated with burial. After these expenses, a tax professional will look at your remaining assets. He or she will then determine the appropriate distribution to maximize the amount of money left over.
Payment Schedule
Depending on your family or loved ones, it may make sense to divide up estate payments over time. This may be necessary if estate benefits will transfer to a child. In this case, you will want to work with an attorney and tax professional to make sure payments go out as you see fit. This could be annually or on significant occasions, such as birthdays.
Furthermore, if a beneficiary of your estate has a history of poor money management, it may be smart to appoint a financial advisor. The advisor will oversee transactions with the estate and help them spend responsibly.
An essential part of financial planning is to have a solid estate strategy in place. It is important to know that your estate will be there to help take care of you, should you need it through illness. You also want to rest easy knowing your family will be okay financially after you’re gone.
With the help of an attorney and tax professional, Incompass can help ensure your family is comfortable during a difficult time. We seek to eliminate the amount of estate tax paid to the government or heavy legal fees. Get in touch with us to get started with effective estate planning strategies today.