Estate Planning Essentials

Estate planning allows you to make the payouts of your estate according to your personal specs and wishes. When properly done, your planning ensures

  • transfer of the your assets to the correct heirs
  • preserves assets during your lifetime
  • Lessens the admin confusion which often happens at death
  • reduces your estate taxes and legal costs after your death

Estate Planning Basics

The main options to think about are RE ownership, trusts, gifts, spousal transfers and charitable gifts. First, the data gathering process include

  • general info
  • need for decent legal counsel
  • tax concerns involving fed estate taxes, state taxes, life estates and rother interests.

Finally, handling the probate process and estate sales are also dealt with.

Basic Estate Planning Docs

A will is a formal legal doc informing heirs in handling of the deceased’s estate. Guardianship for children refers to the taking care of a child’s care and upbringing if the parents die while the child is a minor. Plans are made for iillness with powers of attorney and living trusts. Letters of instruction are informal letters which give heirs info about more personal matters such as explanation of assets, location of important docs and other info.

Property Holdings

The rights of ownership are not firm, vary widely by state, are limited by health codes or zoning laws and imply certain costs. Forms of ownership include sole ownership, joint ownership, tenancy in common and community property. Picking the correct asset ownership type is often the key part of sound estate planning given the features, pluses and drawbacks of each type.Estate Planning


Trust are a special form of ownership  which transfers ownership to a third party, the trust, while letting the real owners to retain control by naming themselves or a bank as trustees. They can help you avoid the costs of owning assets outright. Concerns are revocable versus irrevocable trusts, testamentary versus living trusts and choosing trustees.

Giving Money Away

You may want to do a program of giving which can provide income tax and estate tax savings. Gifts arranged for in a will allow you to make a current commitment to help a chosen cause but hold off your actual payout until after death. Other trusts provide an way for giving to a worthwhile cause while making tax savings. Private foundations give you a way to structure your giving, ensuring your kindness will be felt after you die.

 Other Formal Concerns

Although a clear and well-defined body of exists for married couples, cohabiting couple law is slow to hit the main stream. Financially independent clients who plan to marry should consider premarital and post marital agreements. The IRS is particularly unfriendly to US citizens marrying foreign ones and clients in this situation should make provisions ahead. Life insurance can fund an estate and provide liquidity to cover the expenses of an already existing estate.

Funeral Planning

Planning your funeral in advance is perhaps one of the most considerate non-financial acts a you can carry out on behalf of your survivors. Choosing a funeral home,and specifying requested services helps steer clear of overcharging. A letter of instructions, not placed in your safe deposit box can locate your will, describe previously arranged funeral services, clarify organ donor requests, request a specific type of ceremony and specify preferred death notices.

For other Financial Planning topics, visit our Financial Planning page