Practical Estate Planning

When it comes to estate planning, federal estate taxes are becoming less of a factor for most Americans:  A $3.5 million exemption now protects the estates of 199 out of 200 people.  Do you still need to plan your estate?  The answer should be obvious.  Even if the estate tax is not a worry, people still plan for a variety of practical concerns:

• Thoughtful distribution of your estate.  With a will or living trust you can direct who will receive your property when you die.  Otherwise, the state will distribute some of your property for you – according to its own inflexible laws and in ways that may violate your every wish. Your will or living trust may be the only way to prevent injustice to a member of your family.  Suppose, for example, that you are a widow – and that you and your late husband paid for your son's college education a few years ago.  And suppose you die without a will or trust.  The state laws will probably require that your estate must be divided equally between your son and a 17-year-old daughter whom you had also hoped to send to college.  A court-appointed administrator will be powerless to allocate more of your estate to your daughter than to your son.  A thoughtful will can prevent injustices of this nature.

• Naming executors and guardians.  Your will enables you to nominate the person you want to administer your estate.  Your executor (personal representative) must carry out the directions in your will and help your family with any of the special problems (business or personal) that may arise after your death.  If you have minor children under your care, your will can name persons to serve as guardians of your minor children if they should become orphans.  Otherwise, a court may appoint a guardian who does not share your personal values in living. 

• Minimizing taxes that can occur at death.  State death taxes are on the rise in many areas and your heirs or estate may face income taxes on such assets as IRAs, U.S. savings bonds and other items known as “income in respect of a decedent.”

• Financial management for your family.  With a trust, or carefully prepared will, you can provide practical security for beneficiaries who are not really qualified to manage and budget their inheritance.  A trust in your will can guarantee your beneficiaries all the rewards and advantages of property ownership – but with none of its burdens and frustrations.

• Leaving a personal legacy.  Your will or trust can guarantee that the distribution of your property will be a lasting expression of your unique life – perhaps by arranging a special tribute to your husband or wife, establishing a memorial in the names of your late parents, aiding an impoverished friend or remembering a favorite relative with a gift of a carefully selected property.

Your will or living trust enables you to make a thoughtful bequest for our future.  And in a well-planned estate, the cost of such a bequest can sometimes be surprisingly modest.  If you wish to restrict your bequest to a specific purpose, please feel free to consult our staff about the many opportunities available.

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