Death and taxes: the two constants as they say. Given the inevitability of death, it’s only fitting to ensure that all your earthly concerns are dealt with before you expire. There have been quite a few instances of family squabbling over the deceased person’s estate; it is not only distasteful but potentially damaging to familial relations. It would not do to die without having a proper estate plan that will handle the bequest of assets and settlement of taxes.
Here’s a list of reminders to take note of while working on your estate plan:
Establish Rules for Funeral Arrangements
Some people think this is best left to their loved ones to deal with, but actually it would be a lot easier if you make your own funeral arrangements to ensure that the costs will be properly shouldered. This can be done through pre-need companies, but you may also decide to set aside a small amount or fund to cover your funeral expenses. It is also important to note your personal preferences and requests when preparing the funeral arrangements to eliminate confusion later on.
Always Leave a Will
Again, some people make the mistaken notion that wills are only for the wealthy. However, wills don’t always just cover assets; it covers everything that has to do with your estate and is designed to protect your heirs. Without a will, the distribution of your assets will be out of your control and may leave your heirs without their rightful inheritance.
Set Up a Trust to Cover Estate Taxes
If you’re bequeathing quite a sum and some buildings and assets to your heirs, know that this means they’ll have to pay hefty estate taxes. To protect your heirs, you can set up a trust fund wherein the money will be used to deal with estate taxes and eliminate the financial toll it can take on your heirs.
Confirm Your Beneficiaries
Take note that your life insurance policies, pension, and other accounts will have designated beneficiaries. It is imperative that you take the time to review these beneficiaries, as you may have changed your mind in the interim. Make sure you make the proper changes and select the beneficiaries you want.
Identify Guardianship for Young Children
Establishing guardianship (legal or otherwise) for your children is especially important if the children are too young to handle their inheritance. You can create a trust fund for them, of course, but it’s also important to identify the right guardians and mentors to protect your child’s interests until they are old enough to make responsible decisions on their own.
Pick an Executor
It’s a good idea to get a lawyer you can trust to handle your estate plan on your behalf. Remember to pick someone who is reliable, organized, and honest. Since you obviously won’t be around to ensure that your estate plan is carried out, getting a trustworthy executor is a must.