Elements of a Worry-Free Estate Plan

Elements of a Worry-Free Estate Plan

Individuals sometime assume estate plans only deal with future concerns like planning for retirement, providing an inheritance for loved ones, specifying long-term care provisions, avoiding estate taxes and appointing guardians for minor children … all the "someday" or "what if" stuff.

While the statements above are true, your estate plan also eliminates (or at the very least reduces) issues that are usually present now – namely, stress and worry.

My clients typically walk out of the office breathing a huge sigh of relief after they execute their estate plan documents. Why? Because they have created a plan that protects their assets, provides for their loved ones and gives them peace of mind. They know their families are taken care of even if the worst happens.

So, what issues should be considered to create an effective estate plan? Every person’s needs are different, but there are a number of basic elements you should ensure are covered besides deciding who will receive what.

  1. Determine who you wish to manage your affairs if you become disabled, incapacitated or pass away. (A well-structured plan also clearly defines the meaning of "incapacity" so that everyone involved understands the circumstances that must occur before your agent steps in.)
  2. Plan for the demands on your assets if you must enter a nursing home or receive significant long-term healthcare.
  3. Avoid probate, both during your lifetime and when you pass away. (This can be accomplished by the use of a living trust and carefully drafted power of attorney documents.)
  4. Protect children from your prior marriage in case you pass away before your present spouse.
  5. Protect assets inherited by your heirs from lawsuits, divorces and other claims against them.
  6. Create a financial framework and oversight for children and grandchildren who may be too young or inexperienced to effectively manage an inheritance.
  7. Protect a portion of your estate if you pass away and your surviving spouse remarries.
  8. Address the different needs of each of your children (if you so choose), especially children with special needs or challenges like substance abuse problems, physical limitations, etc.
  9. Prevent (or at least discourage) challenges to your estate plan by disgruntled heirs/beneficiaries.
  10. Plan a family estate plan for blended families (families containing children from previous marriages) that ensures all children are provided for according to your desires and intentions.

There are many more potential issues – but these are some of the basics. Your needs will vary depending on your individual circumstances.

Wouldn't knowing that someone will step in if you become incapacitated create a little peace of mind for you? Wouldn't knowing that your family is taken care of in the event of your disability or death provide you even more peace of mind? Wouldn't knowing that there is a plan in place –  a plan you developed – if something happens to you take a significant amount of worry away from your state of mind? Of course it would – and that is why estate plans are as much about how you feel and act today as they are about the future.

Please contact me if I can be of assistance to you or anyone you know regarding your circumstances and any estate planning needs you may have.