It's never too early to start thinking about how your affairs should be handled at the end of your life. If you're like most people, you probably have some idea on how you'd like your property and your assets divided when you die. You'd also likely want to make sure that everything happens smoothly--allowing your family and loved ones to deal with their loss without any undue financial hardship.
Even if you don't consider yourself a wealthy person, professional estate planning can make a significant difference on the management of your affairs. Some of the most common--and most compelling--pitfalls that people fall into can be easily avoided with prior professional help.
One of the biggest factors that drive people into estate planning is the estate tax. However, for most families, this isn't an issue. The threshold for filing an estate tax return in 2016 is $5,450,000. If your total taxable estate is less than this amount, that tax doesn't apply. It's likely that if your net worth is that high, you've already built a strategy for the transfer of your wealth.
That said, many states impose an inheritance tax. One of the best ways to avoid this penalty is to set up trusts and to disburse tax-shielded gifts prior to your death. A legal professional can help begin this process so that your heirs are the primary beneficiary of your wealth--not the government.
Reason #2--Funeral Arrangements
Families are often faced with significant stress when making the funeral arrangements for a loved one. Along with the financial cost of the process, people can disagree on the appropriate way to grieve. The best way to avoid these issues is to handle the entire process yourself.
Your estate planner can help ensure that your wishes are executed fully. Also, funding for the process can be established in advance--freeing your family from all worry regarding scheduling and paying for your funeral. That way, you can be sure that the event will accurately reflect your personal wishes.
If you have dependents, someone will need to take custody of them. Even if you've had conversations with people about this, custody transfers can become major issues when it comes time to actually go through with it.
Your estate planner can help you make the legal transition of custody happen in a seamless fashion. With their help, you'll know that your dependents will be well taken care of by the people you've chosen. The transition will be less likely to cause damage to your family as a result.
Estate planning isn't just for the ill. Even if you're the picture of good health, professional assistance now can create a much better situation for everyone should the unthinkable happen. Contact a professional like Edward G. Foster to learn more.Share