- Provide for your immediate family
Couples want to provide enough money for the surviving spouse. If you have minor children, under 18, you will want to assure their education and upbringing. If you and your spouse pass away you need a will nominating guardians for your children. Otherwise, a court will decide without your input where your kids will live and who will make important decisions about their money, education, and way of life. You should elect when they receive money taking into consideration their personal needs, lifestyle (sports, music, disabilities), and all future needs (college).
- Get your property and assets to beneficiaries quickly
Options include insurance paid directly to beneficiaries, joint tenancy, and living trusts, as well as using simplified or expedited probate and taking advantage of laws that provide partial payments to beneficiaries while a will is in probate. Also, see the blog entitled "Easy Steps to Have Your Financial Assets Avoid Probate".
- Plan for incapacity
During estate planning, you can also plan for possible mental or physical incapacity. Living wills and durable health-care powers of attorney enable you to decide in advance about life support and pick someone to make decisions for you about medical treatment. Also, you will need a Durable Power of Attorney for Finance and Real Estate. These are documents that anyone over 18 years old needs. Remember a Will does nothing for you while you are alive.
- Minimize expenses
Good estate planning can keep the cost of transferring property to beneficiaries as low as possible, leaving more money for your beneficiaries. Some expenses that can be avoided are taxes, lawyer fees, court cost, appraisal fees, newspaper fees, and accountant fees.
- Choose personal representatives/trustees for your estate
Choosing competent personal representatives/trustees and giving them the necessary authority will save money, reduce the burden on your survivors, and simplify administration of your estate. Remember this is the person who is going to "clean up" your estate. They are going to be under stress from family, beneficiaries, companies, and the court process. You will want someone who is good at understanding financial decisions under pressure.
- Ease the strain on your family
You can take a burden from your grieving spouse and beneficiaries by planning your funeral arrangements when planning your estate. Or you may want to simply limit the expense of your burial or designate its place. Ask us about funeral trust which are insurance products that are Medicaid protected, if done right.
- Help a favorite cause
Your estate plan can help support religious, educational, and other charitable causes, either during your lifetime or upon your death, and at the same time take advantage of tax laws designed to encourage private philanthropy. This may be done by trust or by direct beneficiary designations.
- Reduce taxes on your estate
Every dollar your estate has to pay in estate or inheritance taxes is a dollar that your beneficiaries won't get. A good estate plan can give the maximum allowed by law to your beneficiaries and the minimum to the government. In Wisconsin we do not have inheritance tax. The estate tax is $5,490,000 (2017), and $5,600,000 (2018).
- Provide for people who need help and guidance
Do you have an elderly parent or disabled child, or a grandchild whose education you want to assure? You could establish a special trust fund for family members who need support that you won't be there to provide. By creating trust for these individuals, you will avoid the beneficiary from losing their government benefits and you are able to control the assets after you pass away.
- Make sure your business continues smoothly
If you have a small business, you can provide for an orderly succession and continuation of its affairs by spelling out what will happen to your interest in the business. Also, if you become incapacitated during your life, you can plan for someone else to control the business.
- Remember to make arrangement for your pet
If you are single, make sure you arrange for someone to take care of your pets after you pass away. You should always talk with them before you nominate them as beneficiary of a pet. That person might need extra money or space to properly take care of the pets or they might be allergic.
By taking the time and effort necessary to plan your estate, you will be able to:
This blog page is for general educational purposes only. Every legal issue and estate plan should be designed for your own specific individual purpose.
Some of this information may not work for your own individual needs.
You should always seek advice from a qualified lawyer, accountant, and financial advisor concerning your own individual plans.