Posted by : Daniel Stoica in (Articles, Federal Taxes) On: July 11th, 2011
Estate planning is not about death. When you look at it in that context, you will end up putting it off until it’s too late. Thinking about death only dwells on the negative. Estate planning is about the positive aspects of life; your financial security and the security of your family.
You have to take an inventory of all of your assets when estate planning. Keep records of all of your real estate, bank accounts, investments, and major expenses. They should then be divided up among your will or living trust.
You need to keep a record of your smaller assets, as well. Your attorney will advise you on the record keeping of your larger assets, the small property you own is most likely the items your family members care most about. They are associated with memories, which makes them so much more important.
The only obstacle you may have when planning your estate is your taxes. Anything you leave to your family and friends will be taxed. There are, however, ways to lower the taxes placed on these items. A trust is generally referred to as a will. You can choose how your trust will be divided and to whom your assets will be divided among. This will lower the estate and gift tax. Your family will also avoid probate court when you have a trust. It’s a lengthy process that can become expensive and unnerving for family members who are already grieving.
Talk to your family about what will be divided up and who will receive what before you finalize the trust or will. Find out which person wants what and what matters the most to them and you can put the item(s) in the trust where they will inherit that item. It is important to know what your family expects, even though no one wants to talk about it. Talking about it before hand will eliminate any arguments later, and it will allow you to speak seriously about your final wishes before you pass on.
You shouldn’t put off planning your estate and writing up a will or trust. It’s a common myth that if a person writes out their will, they will die shortly after. This just isn’t true. Many people write up a living trust in their 30s and 40s and updated it every so often. Some of them even end up living well into their 90s. Don’t put off planning your estate. Remember that it is not only for your peace of mind, but for your family’s as well.