Putting together the right estate plan is a key strategy when it comes to building your wealth and making sure that it is passed on accordingly when you die. The more sound your estate planning process is, the smoother the transition will be for your descendants. If you need some direction, this article will help. Follow these guidelines and use them so that you can handle the estate planning process to the best of your ability.
Reduce Your Tax Bill
While solid estate planning and wealth building can set your family up for generations, things like tax debt can eat away at your hard-earned dollars. With estate planning, the two major taxes that do this are income tax and estate tax. A way around this is to set aside a number of taxable assets that you will donate to charitable causes. In the same way that you most likely donate to causes for goodwill and tax relief while alive, you should allocate some assets in your will so that your tax bill is much lower. You can also be sure to allocate the assets that cannot be touched by taxes, including your Roth IRA and life insurance.
Decide In Detail Which Family Members Receive Assets
The biggest headache to deal with after a loved one passes is to figure out who gets which assets. Even though a death in the family is a terrible time, the allocation of assets can turn family members against each other in a tragic way when there is confusion. Because of this, never leave it to family members to decide for themselves. Itemize each and every allocation while stating specifically which family member is entitled to it. This way, there will be no wiggle room to have your will misinterpreted. It takes much of the headache and heartache out of the situation and allows the family to properly grieve.
Hold Conversations About The Estate While Alive
A mistake that some people have with their estate planning is to never discuss their death or their will with relatives. In this situation, elder family members have a will in place for years, but family members have no idea what the will states until their death and it is time to execute it. You should have a few frank conversations with your family members in a relaxed manner, so that they understand far ahead of time how your assets will be allocated and what your wishes are with executing the will. This gives people time to digest the situation while you are alive, so that it is nothing but a formality once you pass.
Keep these tips in mind and your estate planning should be smooth sailing. For further help, touch base with an estate planning professional, like Lisa Cappolella Attorney at Law, who can help you out.Share