The Easy Way To Get Started On Your Estate Plan

Published by Mark Ring, Wealth Advisor

Some tasks are easier to accomplish than others, so naturally these are the ones we choose to tackle first, leaving the more difficult tasks for another day. But there are some tasks that are too important to continually put off again and again. Estate planning, for example. Most of us avoid this particular task for a variety of reasons: maybe we don’t want to think about our lives ending; perhaps it seems too costly; or maybe it doesn’t even seem necessary. In fact, only 51% of Americans have done any estate planning, (1) which means more than half the population is taking a huge risk when it comes to caring for their families and assets.

Regardless of how much (or how little) you have to your name, if you don’t create a plan, you are leaving your loved ones with legal headaches. Without medical directives, families are left to guess how to handle end-of-life care. Without a will, determining how to divide assets is often left to impersonal judges. Unnecessary probate and taxes diminish the funds left behind. 

Our chaotic and difficult lives often make it hard enough just to take care of day-to-day business, much less the legal and emotional complexities of estate planning. But while it may seem daunting, the process of thinking through your estate plan does not need to be complicated or stressful, and the benefits far outweigh any temporary headaches. With that in mind, here are five basic steps to get you started on your estate plan.

1. Draft A Will

Everyone needs a will to spell out their wishes and name someone to handle their financial affairs. Each person’s will is unique and will include different requests, but a few standard essentials to include are: 

  • Guardianship: If you’re a parent of a young child, this is one of the most important parts of your will. Be sure to name a legal guardian for your minor children, so if you pass away before they are legal adults, they will be cared for by the person of your choice without legal drama. 
  • Assets: In your will, you’ll define which heir gets what, including percentages of your savings, specific accounts, certain properties, cars, or other valuables and sentimental items. 
  • Real Property: Beyond assets, you may also have homes and buildings that you want to leave to specific people. 

Once your will is drafted, it’s critical to keep it up to date. Review it at least every two to three years and whenever you experience a major life event, such as a marriage, divorce, death, or birth. 

2. Appoint Trustworthy People

The next decision to make is to choose who you’d like to take care of certain responsibilities in the event of your death. Some people opt to have one person take on the various roles, while others appoint multiple people to carry out the different tasks. Some states have stipulations on who can serve in these roles, but they are often family members. (2) The primary roles are: 

  • Executor: This is the person who is legally responsible for carrying out your will. They will ensure that your assets are distributed to your heirs and that your valuable items are given to the people you intended. 
  • Primary Agent: A durable power of attorney is a document that gives someone the legal ability to take care of your financial affairs if you are unable to do so. This person, called the primary agent, should be someone who is financially savvy and organized. They will handle any bills or income received and will follow your instructions laid out in the durable power of attorney. 
  • Healthcare Proxy: Similar to a primary agent’s job to make financial decisions on your behalf, a healthcare proxy is someone you appoint to make medical decisions for you if you are unable to do so. These wishes can be laid out ahead of time in a document called a medical power of attorney.

Start a conversation with the people you trust most to handle your affairs and let them know that you are including them in these official documents. 

3. Consider Trust Funds

Depending on what you want to accomplish with your assets and the specific needs of your situation, you may want to look into setting up a trust fund for your heirs. Contrary to popular belief, these are not just for the very wealthy. Trusts can be a wise way to ensure that the legacy you’re leaving behind is protected. There are also significant tax benefits in choosing trust funds, as money in trusts bypass probate. 

You may consider setting up a living trust, also known as a revocable trust. In the event of your death, the trust ends and is distributed to designated beneficiaries, similar to that of a will, except that the process is quicker and the assets are not taxed. If you’d like to contribute some of your assets to a cause that is close to your heart, you may consider a charitable remainder unitrust (CRUT). This not only aids a charity but also gives you immediate tax breaks. (3) 

Talk with an estate lawyer to help you determine which option is best for your situation. 

4. Organize All Important Documents

It’s important to keep all of your estate planning documents safe and organized so they are accessible when they’re needed. Using one central location, gather all important documents, including: 

  • Tax returns from the past seven years 
  • Insurance policies 
  • 401(k) statements 
  • Bank account information 
  • Mortgage paperwork 
  • Loan documents 
  • Brokerage statements 
  • Social Security, health insurance, and Medicare cards 
  • Contact information for your financial advisor, doctors, lawyer, and accountant
  • Will

Make sure your spouse or closest family member knows where to find this information. 

5. Rely On Experts

Planning an estate involves many intricate details and time-consuming tasks, but don’t let that prevent you from getting your affairs in order when a professional is available to help. While it is possible to create wills online nowadays, there are often complex nuances to estate laws, and regulations differ from state to state. 

An estate lawyer can help you sort through some of the different options to help you create the best plan for you and your loved ones. You should also consider meeting with your financial advisor, as he or she is heavily involved in your financial life and can work with you to make a plan for your assets and connect you with a reputable estate lawyer. 

Ready To Get Started?

We’ve all learned by now that life usually doesn’t go as expected, and we have no idea what tomorrow might bring. So it’s never too early to start putting a plan in place for your estate, and we know you will feel more secure once you’ve taken the necessary steps. At Jacob William Advisory, our goal is to provide our clients with workable estate plans they can execute with confidence, so whether you are starting from square one or updating your will or other documents, we’re here to help. Contact our office today by calling 410-821-6724 or emailing [email protected], and feel free to download one of our free guides found here.  

About Mark

Mark Ring is a Founding Partner and Wealth Advisor at Jacob William Advisory, a wealth management firm whose sole mission is to service their clients’ needs beyond their expectations. Mark has over 30 years of industry experience and for the past decade, he has been committed to building Jacob William Advisory into one of the foremost wealth advisory firms. Mark graduated from the University of Maryland with a Bachelor of Science in Economics and spends his time outside of the office with his wife, Nancy, and his two wonderful children. He gives his time to numerous nonprofit organizations related to education and the arts, often serving as a board member. He enjoys playing tennis, golf, bicycling, cooking, and traveling. Learn more about Mark by connecting with him on LinkedIn

For a comprehensive review of your personal situation, always consult with a tax or legal advisor.





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