Estate Planning: The Smart, Easy, and Personal Way​

Do you think that estate planning involves downloading some run-of-the-mill template off the internet and signing it because it sounds just about right? This article invites you to think again. Estate planning should be a meticulous and personally relevant process that ensures your assets and financial legacy are protected according to your wishes. To avoid leaving generic instructions that do more harm than good, you should apply these three tenets when planning your estate: Excellent communication, High-level Clarity, and Full Customization of your wishes.

It’s important to remember that mistakes in your estate plan can be the only difference between whether your beloved great, great, great, great-grandchildren are born into financial stability or not. The most essential step in any estate plan is the appointment of beneficiaries. Beneficiaries can easily be categorized as family, friends, and charity. This means you can provide for the ones you love, indulge in your philanthropic interests, and change the course of many lives even after you are gone. But how do you go about it the right way?

Again, keep in mind that your estate plan should be your most celebrated work of art as it ensures the continuation of your vision and everything you strive for in this life. It should not be something that you quickly draft over a cup of tea. However, that doesn’t mean you should spend endless hours agonizing over it, either. Just make sure your estate plan is truly yours. Own every word in its pages and feel how every letter resonates with your personal wishes.

Don’t be intimidated by the legal details of your estate plan; your wishes are first and foremost. This article uses the three tenets mentioned above to guide you on the best way to create a profoundly effective document that intimately encompasses your loved ones as well as the causes you are drawn to.

Excellent Communication to Ease Your Mind

In these modern times, information on estate planning is just a few clicks away using electronic means. In light of this, making your estate plan has never been a more straightforward process as you will find, in most instances that a sturdy and mechanically correct foundation has already been laid down for you. Your estate planning attorney will help you to review the legal fine print to ensure you’ve dotted all the I’s and crossed all the T’s.

This is advantageous in that it frees you to focus on corresponding critical matters that require your attention where your estate plan is concerned. In this case, that means exercising excellent communication skills with your family, including your spouse, children, or any agents involved. It’s important for spouses to have the same way of thinking and to be in sync through every stage of the drafting process. An estate plan that has the whole family’s intentions at heart leaves no room for the incorrect distribution of your wealth.

The professionals involved in helping you draft the right estate plan (your attorneys, financial advisers, etc.) should be part of your extended family during this paramount interval. They will provide vital services that will guarantee the smooth and coherent functioning of your estate. Children and heirs should not be left out of this process too. Admittedly, some matters are deemed not suitable for the young ones but giving them even a small measure of literacy in your estate planning process will create transparency that is infinitely beneficial.

Furthermore, the level of communication you will be able to exercise depends on the culture inherent in your family. Your spouse or children may not be wholly interested in knowing all the fine details of the estate plan. However, it’s important that you feed them the “bare bones” so they are acquainted with how the whole thing works. At the very least, they should know who to contact in the worst-case scenario. This interaction and exchange of information with your family will greatly ease your mind allowing you to go through the next stages of your estate planning process with better efficiency.

High-level clarity to rationalize your intentions

The science of dispositive documents has dramatically evolved and is now more complex than just leaving a will. One thing to consider is leaving a “personal letter of wishes” as an extension of your last will and testament. This is a document that simply expresses the wishes contained in your will in a personalized way that is more familiar and less formal to your family. Keep in mind that this personal letter is not legally binding and will not be publicly accessible since you can decide who sees it and who doesn’t.

A personalized letter to chosen members of your family circle gives you the space to explain in detail the provisions you made in your will as well as any justifications you might also want to add. Understandably, your decisions may create complex emotional responses in your beneficiaries ranging from guilt, anger, and disappointment to surprise, and gratitude. 

Firstly, this personal communication allows you to “clear your name” to those who may perceive your intentions in the wrong light. This also helps you to avoid an unnecessary guilt complex. Secondly, your personal statement can be used to offer advice or opinion to your beneficiaries regarding the course of action they should take once they receive their assets. This also the opportune moment to share your deeply held desires about your estate, for example, you may want your family to retain control of a business rather than selling it or perhaps you may wish for certain family heirlooms (grandma’s wedding ring, for example) to be preserved for future generations.

This level of clarity confers a more deep-rooted and thoughtful understanding of your humanity to your beneficiaries which goes a long way in ensuring they respect your wishes as well as the reasons behind those wishes. While this document is not a must-have, it is often very much needed. In most cases, it is nearly impossible to split the distribution of your estate among your beneficiaries with an equality that rivals mathematical precision. Consult your estate planning attorney on the best way to draft this personal communication so that it embodies the overall organization of your estate plan.

Full Customization of your wishes to ensure they are recognized

Full customization of your wishes provides for an estate plan that is well adapted to your unique circumstances and preferences. Applying this final tenet to your estate planning process ensures your intentions can and will be honored. Thus, your estate plan should reflect every aspect of your intentions, including any elaborate and complex inclinations you might have towards your family, humanitarian projects, and the distribution of your wealth. A well-appointed financial adviser with fiduciary expertise is a requisite as they will help you unravel every minute detail that needs to be a part of the legacy you want to pass on.

Moreover, it is important to have a financial adviser that understands the high level of flexibility required with an estate plan at different points of its maturation. Unforeseen events may disrupt financial investment plans or designated monetary allocations. They need to be able to make the necessary, optimum adaptations while strictly remaining within the framework of your wishes and intentions. Thus, your legacy will continue in life and in death steered on by a financial adviser that understands the direction it should take.

While you continually review and revise your estate plan, it is essential to integrate these three tenets into your ultimate legacy framework. They will help you achieve the highest level of fulfillment regarding the welfare of your beneficiaries and their in-depth understanding of your intentions as well as their assured knowledge of your love and appreciation.

Arranging your affairs

Within your power, arranging your affairs (such as Wills & Testaments) before you die can help those left behind and can avoid issues during difficult times.

1. Create a Will.

If you haven’t already done so, now is the time to make your will document. 

2. Compile your paperwork.

Naturally, you know where you keep your paperwork, but your executor and/or family members won’t. It will be a big help if you inform them of where you keep important documents, including: 

  • Bank statements
  • Marriage certificates
  • Divorce papers
  • Property deeds
  • Credit card statements
  • Insurance policies
  • Mortgage information
  • Birth certificates
  • Tax certificates
  • Details of savings and investments

It’s also a good idea to create a list of regular payments that will need to be cancelled, such as magazine subscriptions and donations to charities etc.

3. Inform your executor of where your Will is.

4. If you can, think about clearing any debt amounts you may have.

This can include things like credit card debt and loans that are not secured against your house. If you are able to, you might want to pay them off, making things simpler for your executor.

5. Get some assistance in case you need it.

If there is a chance you will become too ill to manage your money, think ahead about who should be able to manage it for you. Perhaps think about putting in place a power of attorney if you expect there to be a long period where someone else needs to act on your behalf. This will give them the power to do things such as:

  • Setting up accounts on your behalf
  • Ensure bills and care costs are paid without you needing to worry about them.

You can only put this power into place while you are of sound mental capacity to do so. Don’t leave it too late if possible, or else someone has to apply to be appointed this power. This can be expensive, and the court might not appoint the person you would have chosen.

Should I worry about an estate tax?​

Only the lucky few who have estates worth over $5 million need to be concerned about an estate tax, or more commonly known as a ‘death tax’. If your estate is worth less than $5 million, then there is no estate tax to pay.

Make sure your will document is legally valid​

It doesn’t have to be written on special paper or use excessive legal language. Your will is valid as long it adheres to the following conditions:

  • It states how your estate should be divided when you die.
  • It was written while you were in the right state of mind to make your own decisions, and you weren’t pressured about who to leave your belongings to. 
  • It is signed and dated by you in the presence of the number of independent, adult witnesses required by state law and then signed by these witnesses in your presence. Note that these witnesses can’t be people who are going to inherit any of your estate (or their wife/husband/civil partner). In most states you need two witnesses, however in some, such as Vermont, you need three.

Bank of Mom & Dad

Bank of Mom & Dad See the table below for % of 21-39 year olds who have relied on parents financially since the start of