Estate planning during challenging times

Estate planning during challenging times

| Nov 6, 2020 | Firm News |

Planning your estate helps you and your family deal with the unexpected. But the last few months have provided even more health, financial and emotional challenges. It is important to engage in estate planning to decide how to divide up your assets after you die and deal with your possible incapacity.

Wills

Preparing a will is an essential part of your planning. Otherwise, a judge will decide how your assets will be divided and their decision may not match your wishes.

Starting the process

Following a process will help with planning your will and dealing with other estate matters. First, you should determine all your assets and liabilities. Gather all your financial information such as bank and investment statements, mortgage, and other debt information.

You also need to account for digital assets. Have a safe place to keep a list of websites and passwords.

Next, decide which individuals will perform important roles for you such as acting as your agent under a power of attorney, health care proxy or the administrator of your estate. Selecting a guardian for your children is one of your most important decisions which may need many discussions with your spouse and other family members.

You also need to decide how you would like to pass on your property to your heirs or selected charities. Trusts may be one way to control how property is distributed, especially to young children. You should also address the best method to deal with creditor issues, potential divorces, and grandchildren.

Other tasks

You also need to learn which assets pass by will and other means. Insurance policies and retirement accounts pass to a person designated as a beneficiary and not through the will. A home owned jointly with rights of survivorship go to the surviving owner.

You should inventory assets with beneficiaries. Review and update your beneficiary designations to assure that property is left to intended individuals.

Other issues that you should review are the federal estate tax, which is imposed on estates over $11.58 million. It will not impact most families, but other tax consequences may need consideration.

Also, consider how accounts and insurance are titled. It is also important to know where they are held.

Finally, while uncomfortable, a family meeting should be held after the documents are signed and an estate plan is in place. This can help explain any unequal distributions and other decisions.

An attorney can help prepare an estate plan that meets these needs. They can also draft documents that meet Colorado legal requirements.