Investments, cars, homes, savings, and personal possessions owned at a person’s death are their estate. Upon an individual’s death, their estate is given to heirs. The assets must be distributed through the instructions on the deceased’s will. That is known as estate planning and is crucial to protect assets.
Today we talk about what people should know about estate planning.
Why Estate Planning Is Important
Setting up your estate is not an exciting process, but it is necessary to save financial headaches long-term. By deciding who receives your savings, investments, and other valuables you make the process of transferring estate easier on the inheritor.
An estate plan secures all beneficiaries. If you do not decide who inherits your values, the court determines it. It is crucial to the estate plan so that it’s fair to all heirs. When the case is taken to court, it could take years to resolve and costs a ton of money. Developing an estate plan protects your heirs from tax problems incurred from inheritance.
Eliminating family feuds is more straightforward with an estate plan in place. Things have often turned ugly between people who have argued over an inheritance. With careful estate planning, you can avoid all of this.
Now let’s discuss some of the estate planning steps required.
Create an Inventory of Your Liabilities and Assets
Take everything you own, such as properties, cars, investments, savings, retirement accounts, jewelry, cash, and compile it into a list. Keep the list in a safe location (digital copy) with all necessary documents. You can include details such as your financial advisor’s details, just in case.
Would you mind going through the items in your home and making a list of them? Add IRAs, bank accounts, 401(k) plans, or other non-physical assets to the list.
You can place all your obligations and debts on another list for liabilities. Other financial obligations such as mortgages, auto loans, credit cards, and personal loans should all be included.
Once the inventory is created, be sure to make copies and keep them safe.
Make a Contingency Plan
It is complex and tricky to determine the best estate plan. If suddenly you become debilitated, your family won’t need to fight for the property in court. An attorney or accounting firm could help you with this process and answer any questions you may have.
Choose the Would-Be Guardian of Your Children
If you don’t plan your estate, the court decides who the children’s guardian is when you pass. By doing estate planning, you choose a preferred guardian. Should you encounter a disability, you may select an individual to take care of your financial decisions.
Beneficiaries are already included in life insurance policies, but you need to add them to your Will or Trust for other assets. The goal is to provide for your children, parents, and other dependents. Any children from a previous marriage should be included too. If you have children with special needs, ensure they are covered in the plan.
Look for a Trusted Company
Finding the right company can be challenging, but we have been dealing with these sorts of issues for 30 years. It is an ongoing process, so working with a reliable company is essential.
Finalize, Sign and Notarize Your Estate Plan
Remember that you need to minimize expenses and protect all your assets when estate planning. Include a strategy for disposing of unique assets that are not up for inheritance.
Would you please go through a check for any final items before signing it off? Once your estate plan is finalized, notarize it.
Update as Needed
Ensure documents are kept securely once notarized and finalized. Storing your trust or will in a fireproof safe is the best thing to do. It must be easy for your family to find, but in a place that cannot succumb to damage.
Estate planning can happen multiple times. You can update your plan as you see fit. However, after every update is made, it has to be signed and notarized.
When Is the Best Time to Estate Plan?
Nobody wants to think about death or the possibility of dying. But the reality is that it can happen at any time. That is why it’s recommended to do estate planning now before it’s too late. The worst thing that could happen is that the courts take control of your assets, leaving your family in limbo.
These processes can take years to solve and cost a hefty sum of money. Now is the best time to begin estate planning as it protects your family immediately.
Our families are essential to us. We want the best for them even when we have passed. Creating an estate plan and organizing for the future is the best thing you could do for them.
Each day we help people to establish their estate to be fairly distributed. Marcus, Fairall, Bristol + Co., PLLC has been in the financial industry for over 30 years, and our qualified staff can assist in many fields. When you deal with us, you deal with the right people.
Get Your Accounting Questions Answered by Accountants in El Paso, TX
If you’re looking for a reputable CPA firm in El Paso, TX consider calling us at Marcus, Fairall, Bristol + Co., PLLC! We’ll answer any and all of your accounting-related questions. We offer our clients a variety of accounting services such as the following:
- Forensic Accounting
- Tax Problems and Resolution
- Tax Planning for Individuals
- Small Business Accounting
- Non-Profit Accounting
Marcus, Fairall, Bristol + Co., PLLC
230 Thunderbird Dr Ste G, El Paso, TX 79912
Phone: (915) 775-1040