Planning for your Family’s Future

My church has been having VERY helpful classes lately that I wish you all could come to. You may remember last month I posted about our First Aid / Basic CPR class. This month we learned about Estate Planning from a lawyer. While this is a topic most people don’t want to think about, it’s very important to do at least some basic estate planning as soon as you have any assets and/or dependents. Now here is my disclosure … I am NOT a lawyer, I took notes as best I could with a baby in my arms, and this stuff scares and confuses me a little. Consult your own professional as each family’s needs and wants vary greatly. And on that note, here is a general overview of what we learned about.

Planning Your Future

Benefits of Estate Planning

  • Avoid having your assets tied up in probate
  • Clear directions on what will happen to your children should you and your spouse both pass away
  • Beneficiaries can pay less inheritance tax
  • Allows YOU to make decisions, rather than the courts
  • Peace of mind in knowing things are taken care of

CREATE A WILL

A will is the foundation of your estate planning. Without a will the courts will decide what happens to your children and your assets, and your family that is left behind could be in for a mess. Your will should include the following items:

  • Nominate a guardian for any children you have
  • List your assets and how you want them distributed
  • Name an executor of your estate to take care of fulfilling your wishes

A few things to consider:

  • Beneficiaries on life insurance policies and financial accounts will take precedence over a will, so make sure they are all updated appropriately.
  • EVERYONE that has assets should have a will.
  • Review your will each year, modify it should any major life changes occur such as the death of a beneficiary, addition of new beneficiaries, major changes in financial situation, etc.
  • Don’t hide your will in a safe deposit box. Keep a copy somewhere your family can easily find it.

ESTABLISH A REVOKABLE TRUST

A trust is used to distribute your assets without the use of courts or attorneys. If a husband and wife both put their assest into a trust, only ONE inheritance tax is charged rather than one on each of them (I wasn’t exactly sure what this stuff means but it sounds like a way to let your heirs keep more of a your money which is a good thing, hehe). Here are some things to note about trusts:

  • Money and assets in your trust are not protected from lawsuits against you.
  • IRAs should not be included in the trust as they are able to roll directly into the IRA of an heir with no penalties
  • You should select ONE trustee to manage the assets in your trust according to the directions you leave in your will
  • The trust should be updated if your trustee changes or your beneficiaries change
  • You should include a “Pour-Over Will” which is a safety net to administer property that is not in your trust due to accidental exclusion or that was acquired after your death

HAVE A LIVING WILL

Having a living will allows you to decide whether or not you want to remain on artificial life support when there is no chance of recovery. It relieves your family of the burden of having to make that decision. This is a very good thing to have.

HAVE A DURABLE POWER OF ATTORNEY

A durable power of attorney allows you to name someone of your choice to handle your affairs in the event that you become unable to do so. You can specify what those circumstances are.

Summary

If you have less than $10 million in assets, these four documents should be sufficient for your needs and are very reasonably priced to have established. If you have more than $10 million you will need to explore some more complex estate planning options.

Hopefully that was a helpful little overview for you. Now you should be able to at least know some of the questions to ask if you go to have a meeting with a lawyer to get your affairs in order. Please remember we’re not trying to give legal counsel, just give you some things to think about for you to research further.


Pin this post to save for later!

Planning for your Family's Future


  • cshields

    Great overview. Here’s something to note, which I learned from my husband, who is an attorney – you do NOT have to hire an attorney to help you prepare a will. As long as it is HANDWRITTEN by yourself, and signed and dated, it is legal.

  • Dolphin2

    A durable power of attorney is of value only if you are living. It becomes void if you die.  It is not a substitute for a will.

  • Most average people do not think through things this advance. I know it can be unpleasant to plan things that are to occur after we have left but we must think of the loved ones we will be leaving behind.

  • Grieving a fractured family

    Assets in a revocable trust can be distributed to heirs without going through probate which is helpful.

    If you know you are going to be the executor of a will or trustee of a trust, learn/read about the process BEFORE the person dies… You will be able to ask questions, learn where the documents you will need are located. You may still need the assistance/help of an attorney and an accountant.

    If your children are adults, please don’t choose one of them to be executor/trustee if you want them to get along after your death.

    • Thank you for your additional thoughts. It’s so true the better prepared you are before you go, the better situation you leave behind for your loved ones.