Column, Money Matters

Do you need an estate plan?

By Kevin Theissen

The only person who doesn’t need an estate and gift plan is the one who lives forever and never gets sick!

Over 50% of our adult population (120 million adults) do not have nor realize the importance of having a current or up-to-date estate and gift plan to protect themselves and their family’s assets; that may include half your family, friends, and associates.

Estate and gift planning is a financial process that can protect you and your family and is a very important component of your overall financial planning. Now is the perfect time to put your estate planning house in order. If you don’t have an up-to-date estate plan and you happen to get hurt or sick and cannot manage your financial affairs, the courts will have to appoint someone to manage them for you. The person they appoint might not be the one you would want to perform those tasks.

Without an estate plan, when you pass away, your affairs will be settled by default through a complex legal system called probate. The handling of your financial affairs can turn into a costly and frustrating ordeal for your family and heirs. Your assets may not pass to your desired parties, and there is no way for your assets (significant or modest) to get to their favorite charities or causes unless some advance arrangements are made.

The crafting of a good estate and gift plan starts with planning, followed by the proper drafting and signing of appropriate legal documents such as wills, trusts, buy-sell agreements for business owners, durable powers of attorney for financial management, and an advance healthcare directive or health-care power of attorney. Having these documents in place saves you and your family a lot of money and time at a very difficult and emotional time. Your estate planning should also address the coordination of the way you hold title to your various assets, your beneficiary selections, and the possible transfer of certain assets while you are alive.

Regardless of the extent of your net worth, estate planning is important for everyone. Complex strategies may be used by wealthy people to reduce death taxes and costs. Others may only require a simple will and/or trust to pass on property to their heirs and provide for minor children.

Even if a simple will and power of attorney is all you require, an estate plan is an essential part of your financial and gift planning. Everybody will need it someday. The time to address or update your estate plan is now.

Kevin Theissen is the owner of HWC Financial in Ludlow.

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