When you die, you will likely have possessions and assets that you want to transfer to your family members or other loved ones. There are two approaches you may take to address how this will occur. You can either see an attorney for estate planning, or you can let the court system in your state decide the matter. Planning is the most effective option. There are several different methods available to meet your specific needs, including a living trust. You may think that only the wealthy must worry about estates and need trusts, but that is not so. The following outlines three major considerations when planning your estate.
Estate and Death Tax
If you have a very large estate, you could be subject to a hefty tax if the value exceeds $11.2 million. This amount is $22.4 million if you are married. If your spouse survives you, the law will allow them to claim any exemption that was not used by you. Proper planning can be done to assist with reducing or eliminating this tax.
Troublesome family members
While accumulating assets over your lifetime to leave to your loved ones seems like a good idea, how that plays out could be very different from your intentions. For example, if your children are young adults, they may squander their inheritance to buy fancy cars, high-end technology, or designer clothes. This may not be what you envision. Leaving money to a married couple is also risky if that union ends in a divorce. In addition, a child may get into a situation where they are forced to file for bankruptcy or they are sued by another party. A long-term discretionary trust through estate planning is one way to preserve and protect the inheritance you have created now and into the future.
Procrastination
The most important step of planning your estate is to not put it off. When you are healthy and in the prime of your life, it can be challenging to sit down and mull over difficult end-of-life decisions. Not doing so when you are able to can result in lengthy legal issues for your family members. Keeping your will updated in accordance with your wishes and changing financial picture will ensure that the estate process will be carried out smoothly after your passing and not burden your loved ones during a vulnerable time.
Ready to take the next step? Call us at (301) 610-0055 or (561) 290-2179 to schedule an appointment.