The Best Way to Initiate an Estate Planning Engagement

//The Best Way to Initiate an Estate Planning Engagement

The Best Way to Initiate an Estate Planning Engagement

Posted by: Heinz Brisske

First of all, you need to understand what an estate plan is and what it is not. Too many people regard an “estate plan” as simply a set of documents that directs the distribution of assets at time of death. A proper estate plan is far more than that.

A proper estate plan will provide protections for you while you are living as well as provide for a responsible wealth transfer to your loved ones at your death. In many cases a well-drafted estate plan can eliminate costly and time-consuming probate proceedings and minimize, if not eliminate, estate taxes. It will provide for a responsible party to step into your shoes in the event of disability and at time of death, to efficiently handle your financial and medical needs, and to assist with beneficiaries who are not yet capable of handling an inheritance.

You will need to have an understanding of your needs, your spouse’s needs, if you are married, and the needs of your loved ones whom you will benefit. You will need to know each beneficiary’s strengths and weaknesses. You will also need to have a solid grasp of your assets, their values, and how they are titled. Estate planning should never be initiated unless your attorney has a full understanding of all of these issues.

The attorneys at Huck & Brisske, LLC always begin the estate planning process with a request for personal and financial information in the form of an Estate Planning Questionnaire. We are often asked the following question:

Why do you need this level of detail, on both a personal and financial level?”

As stated above estate planning involves far more than the drafting of documents that distribute assets at time of death. We need detailed family and financial information for the following reasons:
  1. Information about the members of your family helps us make recommendations about asset distributions and puts us in position to answer your questions accurately. It also ensures that transfers at death are done responsibly; age, competency, marital, and other issues may play a part in this determination;
  2. The kinds of assets you own, how they are owned, their value, and other relevant information about your estate helps us to determine liability for state and federal estate taxes and develop a plan to minimize or avoid tax liability; this information also allows us to provide you with planning and distribution options and asset protection advice;
  3. If your plan involves a Revocable Living Trust, your plan is not complete and will not work as designed unless all assets are transferred into trust. The probate-avoidance feature of Revocable Living Trusts requires that assets be owned by the trust. Without information about your specific assets, we cannot help you properly fund your trust.
  4. Life insurance policies, annuities and retirement accounts (i.e., IRAs, 401(k) plans) must have appropriate beneficiary designations. Not only should these beneficiary designations be coordinated with the design of the estate plan, but there are potentially serious income tax issues that need to be addressed in order to avoid disastrous results for beneficiaries. Without information about your life insurance policies, annuities and retirement accounts, we cannot advise you regarding proper beneficiary designations.

In short, it is impossible for us to properly advise you on any aspect of your estate plan without the specific, detailed information requested in our Estate Planning Questionnaire.

By |2018-06-13T15:10:23+00:00October 25th, 2012|Trusts & Estates|0 Comments