Do you have an estate plan? Don’t make the mistake of overlooking your assets because you think you don’t have any. In fact, a basic estate plan is an important financial document for everyone to have. MoneyMindz, Financial Advisory Portal makes you learn the significance of estate planning.
What is exactly Estate Planning?
Estate planning is the process of designating who will receive your assets and handle your responsibilities after your death or incapacitation. The goal is to make sure your beneficiaries receive these things in the most cost-effective way possible.
Though it’s sometimes viewed as a task primarily for older people, estate planning can help young people establish a foundation that they can fine-tune as their personal and financial situations change.
How it Works?
Many people think they don’t need to do any sort of estate planning, and they think that the existence of a simple will does the job. However, wills are simply legal documents that express the decedent’s intentions for burial and to whom he or she wishes to pass money and property (the estate) when he or she dies. A judge has to allow the transfer of that money and property from the decedent’s accounts to the beneficiaries’ accounts. This procedure is known as probate, and it opens the door for relatives or third parties to contest your will and for a judge to misinterpret your wishes, both of which can tie up an estate in court for years.
Why it matters?
Estate planning is for everybody, not just the wealthy. Without an appropriate estate plan, friends and relatives can spend a lifetime (and their life savings) battling over your assets. It can be intimidating, but it is a necessary step in ensuring your assets end up where you want them, without the interference of the IRS or third parties.
Establishing a trust is a great way to mitigate some or all of the estate taxes that would otherwise be owed upon your death. A trust allows a person to transfer legal title of his or her property to another person while they’re still alive, potentially saving thousands in taxes.
A trust also gives the trustee (the person acting on behalf of the decedent) the authority to distribute assets immediately to the beneficiaries based on the terms of the trust. No court is involved, so there are no probate fees and no public record of the value of the estate.
How Can an Estate Plan Help?
Regardless of your age, or the size and complexity of your estate, an estate plan can accomplish the following:
- Identify the family members and other loved ones that you wish to receive your property after your death.
- Ensure that your property will be transferred to those you have identified, as quickly and with as few legal hurdles as possible.
- Minimize the amount of taxes that will need to be paid in order for your property to pass to others after your death.
- Avoid the time and costs associated with the probate process by utilizing estate planning devices like living trusts and “payable on death” bank accounts.
- Dictate the kinds of life-prolonging medical care you wish to receive should you be unable to make your wishes known when the time comes.
- Set forth the kind of funeral arrangements you would like, and how related expenses are to be paid.
Understanding the estate plan options that are right for you can be a complex understanding. Smart Financial Advisor, Kuber Mindz can help you identify your estate planning needs, recognize potential solutions helping you at every step of the estate planning process.
For more information visit www.moneymindz.com or give a missed call to 022-62116588.