If you want to have a good estate planning process, you should start working on it as soon as possible. Millionaires and the elderly aren’t the only ones who benefit from estate planning. Everyone should plan their estate! Here are ten suggestions to make the process go more smoothly and stress-free.
1. Make an Informed Decision on Your Team
To have a successful estate planning experience, you’ll need the appropriate people on your side. Most individuals are aware that they require the services of an estate planning attorney, but you may not be aware that you may also require the services of a financial advisor or even a tax specialist.
2. Make a List of Your Assets
Your net worth will be one of the first questions your lawyer will ask. You must be precise. You can acquire an accurate picture of your net worth by establishing a list of all your assets, which includes everything from jewelry to real estate.
3. Make a List of Your Debts
Another important step in determining your net worth is to make a list of all your outstanding loans. You should remove the value of your debts from the value of your assets. This will make things much easier for both you and your attorney!
4. Make Sure The Accounts and Beneficiaries Are In Sync
If you’ve designated beneficiaries for certain accounts, the contents of those accounts will always go to the designated party. It makes no difference if your estate plan contains provisions to the contrary. To minimize confusion, it’s critical to double-check everything.
5. Make a Digital Assets Strategy
In today’s digital age, most people store important information online that must be handled after they pass away. Make sure you have a plan in place to transfer electronic data such as images, movies, and vital documents.
6. Keep Track of Your Taxes
When it comes to estate planning, don’t forget about federal and state taxes. These taxes are usually owed nine months after a person dies. Make sure you account for assisting your family with this obligation as you work with your tax professional.
7. Convert IRAs to 401(k)s
If your sole retirement savings are 401(k)s or regular IRAs, your loved ones will face a significant tax burden when you die. Convert them to Roth accounts to avoid this.
8. Give Money Right Now
Giving money to your loved ones while you’re still living is another approach to avoid them having to cope with tax liabilities. You can give up to $15,000 each year to charity, according to the IRS. As long as you stay within that range, the more you give away today, the fewer taxes they will face later.
9. Make a List of Your Parenting Desires
If you have minor children, don’t just name a guardian in your estate plan. You can include extra specifics about childcare, such as how you want your children to be raised, in your document.
10. At All Costs, Avoid Probate
Probate is the biggest nightmare for the deceased’s loved ones. There are, however, ways to avoid it. Just make sure you tell your lawyer that you want to avoid probate so you can make the necessary procedures.