Without a comprehensive estate plan, the work you’ve done during your life, both at your job and with your investments, can be lost or given to unintended beneficiaries.
The purpose of estate planning is to prepare for the transfer your assets to your loved ones upon your death. Estate planning allows you to specify where each of your assets goes upon your death. Deciding who are the beneficiaries, what each will get, and how to execute those transfers with the minimum tax consequences, while making sure that the estate has enough liquidity to meet its obligations.
Estate planning used to be only for the very wealthy. But even middle-income earners who do a good job investing throughout their lifetimes can benefit from estate planning. It doesn’t matter how much you have, it’s important to understand the basics of estate planning so that your financial and charitable goals are met even after you’re gone.
Estate Planning and Wills
Creating a Will is the best way a person has of providing for others after their death. You may think that you do not have enough money or personal property but stop and add up the value of your house, car, savings, insurance policies – the total is probably more than you realize.
A Will is important for anyone with a family or other dependents, especially if you are a separated or unmarried parent. A Will enables you to be sure that the people to whom you give your property receive it promptly and in a manner which will render your estate liable to no, or relatively little, additional tax. Capital gains tax liabilities may be postponed rather than provoked by appropriate provisions in your will.
A Will allows you to choose your executor, that is, the person who will manage and distribute your property. Leaving no Will creates yet another worry for your family at the time of bereavement. Making a Will is a way of making life easier for them.