In the past few years, there have been enough economic ups and downs to fill a theme park. Planning your future finances when so much in the present seems up for grabs may seem like a second tier priority, but the earlier you consider estate planning, the better chance you have of protecting your assets.
There is plenty to be confused about right now. The estate tax expired this year and property owners are anxiously awaiting new rates, which are expected to be higher than ever. Those who would have been exempt in previous years will find their estates more taxable and their heirs less likely to receive all that they may have planned on leaving.
For all the confusion and all the uncertainty, there is no time like the present to start thinking about the future. The first step is to find an experienced estate planner, likely an attorney, who you trust to guide you.
Do not be afraid to shop around. Many attorneys offer free consultations.
After you have found an estate planner, it is time to look at the big picture stuff. You will likely want to protect as many of your assets as possible. There are many different ways to go about this.
For example, a revocable trust is often set up to protect assets from unified tax credit, or the estate tax. In this way, you may be able to transfer more assets to your loved ones, using the trust to facilitate that transfer at a lower cost to your family. Since it is revocable, you can reestablish control over your assets if you wish.
Consider future healthcare and long-term disability. Do you have a plan for your care later in life? Be sure that you save enough money for your own well-being before you concern yourself with what you will leave to loved ones. Having a plan in place should you become disabled or need the assistance of life support will save your family from making a hard decision that they are unsure of.
In a risky economy, your best bet is having a plan.
Related Resource
- 6 Steps for Protecting Your Money (CBS News)