While it may not be the first thing someone thinks about when considering end-of-life decisions, it’s extremely important to understand the benefits of estate planning, especially for those with valuable, taxable estates.
Not only can the benefits of estate planning provide you a secure financial position after death, but they can also help significantly during your life, to ensure that your assets are protected properly. Proper estate planning can even provide options to lower or eliminate estate taxes, and ease future generations from a number of financial burdens that coincide with the loss of a loved one. It is never an easy thing to consider, but understanding how and why you should talk to an estate planning attorney is key in correctly handling these decisions in the long run.
The Importance of Estate Planning
The importance of estate planning begins far before death, especially in unprecedented events that may inhibit you from making decisions for yourself. We understand that your estate is a reflection of years of hard work, and planning for the future well ahead of time can ensure that an unwarranted incident doesn’t create a burden for yourself, or for others.
Protecting family wealth establishes a safe, secure way for your assets to maintain their value during and after your lifetime. Financial success certainly comes with its negatives, as lawsuits and other schemes can jeopardize your hard-earned wealth. To avoid these uncertainties, a very common way to start is by creating a trust, so your wealth and assets can be placed into legally protected entities. This also allows you to remove your name from assets, and gives chances for insurance to provide funds for your estate and protect you from these legal challenges.
Revocable and Irrevocable Trusts
Setting up a trust can allow you to transfer assets to beneficiaries, help your estate avoid probate, and help plan for your own needs in the event of an emergency. These actions help you to dispose of wealth in the manner you wish, and this alone can save you and your loved ones from many financial burdens. Assets within these trusts become protected, and can even be used for charitable or philanthropic goals. The two trusts to consider are revocable vs. irrevocable, and both come with a variety of perks to help you.
These trusts can help you avoid probate, but the IRS allows you to maintain control of the assets you place into said trust. You can revoke the entity and take back your assets at any time, remaining in control of what you put in and take out. This allows for leniency and security regarding your own decisions, but again, a number of situations can prevent you from making these decisions, which can be worrisome.
Placing assets into an irrevocable trust is permanent. Someone else must become a trustee, and you relinquish ownership in doing so. If your assets are placed in an irrevocable trust, they don’t contribute to your taxable estate, so this is usually important when deciding how to disperse your assets among beneficiaries. If you have something valuable you wish to transfer to a beneficiary, an irrevocable trust can secure that transaction.
How to Start Estate Planning
If you are considering a plan for your estate, your best course is to contact a wealth advisor or an estate planning attorney, to correctly handle the eventualities of your future in a secure and professional way. There are many legal complexities in this process, and seeking advice shouldn’t be something to feel uncomfortable about doing. Professionals in the field are there to guide you, making sure that all decisions are mutually agreed upon.
Walser & Herman Law Firm
Our team at Walser & Herman has been guiding individuals through the estate planning process for over 30 years. We dedicate our time to design plans that meet your unique goals, and help ensure a secure future for you and your loved ones. We understand that years of hard work shouldn’t be open to uncertainties, and we use our many years of expertise to create a plan that is tailored to your needs. If you wish to begin this planning process, or are unsure of any steps along the way, please contact us for any questions or inquiries about the estate planning process.