Estate planning is much more than creating a basic will. A good estate plan is a road map to help you navigate your personal and financial goals during your life – as well as after. An estate plan will protect and provide for your family and can be used to continue your legacy by helping you accomplish the following:
While the complexity of an estate plan may vary, every individual needs a strategy for managing and protecting their estate.
Your “estate” includes all the assets you have accumulated during your lifetime – typically including savings, stocks, bonds, your home, 401ks, real estate, business interests, life insurance and personal effects. If you are just starting out, you may simply focus on who will receive your assets after your death, and who should manage your estate, pay your final expenses and handle the distribution of your assets.
If your estate is larger, an estate plan will outline various ways of preserving your assets for your beneficiaries and reducing or postponing the amount of estate tax which otherwise might be payable after your death.
Estate planning is important for all life stages, including those starting out as well as those closer to or in their retirement years. However, our experience shows that certain life moments typically encourage individuals to develop or revise an estate plan. Below are some events that commonly trigger people to think about estate planning, and the associated needs and benefits for each event.
Starting a Family
Designate guardians for children and provide for survivors
Building a Business
Establish a business succession plan and exit strategy
Change in Marital Status
Revise trust documents and beneficiary arrangements to ensure intended heirs are named and any unintended heirs are excluded
Name successor trustees to make decisions if you become incapacitated
Create a mechanism for supporting causes important to you while protecting your assets and minimizing taxes
1) STARTING A FAMILY
Sarah and John Young both work and are expecting their first child. Once the baby arrives, John will become the primary breadwinner for the family. The couple has money in 401(k)s and a savings account, but their net worth is negative due to outstanding loans and a mortgage. An estate plan would provide the following:
2) BUILDING A BUSINESS
Mr. Owen is a successful entrepreneur with no family-member successor to manage his manufacturing business if something were to happen to him. Mr. Owen has three main issues that should be addressed through careful and thoughtful estate planning, including:
Mrs. Elder and her deceased husband drafted wills that left everything to each other. If something were to happen to Mrs. Elder today, the absence of an estate plan could lead to her assets going to Probate, a potentially expensive, lengthy and public process. Estate planning would help Mrs. Elder’s heirs avoid Probate, and would enable Mrs. Elder to communicate her desires for the transfer of her wealth in a manner consistent with her and her deceased husband’s wishes. Mrs. Elder’s estate plan might include:
At Probity Advisors, Inc., our goal is to help individuals understand estate planning concepts and prepare for the future. Each estate is unique, and each individual has different desires and goals. However, one thing all individuals have in common is the need to plan.
To ensure we understand your goals and can help you plan accordingly, we walk you through our comprehensive Goal Identification Questionnaire to identify your aspirations and objectives. These questions include, Who do you want to inherit your assets? Is providing for the education of your children or grandchildren important to you? Who do you want making medical decisions for you if you become unable to make them for yourself? What values do you wish your heirs to carry forward? Do you wish to make charitable contributions?
We help you identify all of your assets, including any and all investments, retirement savings, insurance policies, and real estate or business interests. We then work with you to identify how your estate needs to work for you to maintain your current lifestyle and help you achieve your goals. This requires an understanding of your current income and anticipated future income, annual expenses, current debts and obligations, anticipated retirement age and a thorough analysis of tax implications of federal transfer taxes, state death taxes and federal income taxes for your unique situation.
After your goals are established and we have a comprehensive view of your financial picture, we will design and structure an estate plan to best meet your objectives. We will discuss a range of scenarios to help you prepare for a variety of situations that may arise. In doing so, we will discuss some or all of the following:
No two estate plans are alike. Probity Advisors will tailor your estate plan to your unique circumstances and goals.
An estate plan involves the coordinated efforts of not only financial planners, but also legal, tax and insurance professionals. After we have
completed the analysis and planning, and after we have thoroughly discussed with you all elements of your estate plan to ensure alignment,
understanding and agreement, the implementation process begins. We will help you name beneficiaries, re-title any assets if needed, acquire
the appropriate life insurance, create bank accounts, and help manage all other necessary pieces to execute your estate plan. We will engage an attorney on your behalf, or work with the attorney of your choice, who will ensure all legal documents are prepared properly.
The estate planning process is methodical and artful. We are here to guide you through the process with ease. A good estate plan is the best
way to ensure that your loved ones are provided for, interest groups are benefitted, and that both the financial and emotional costs are limited.
Probity Advisors, Inc. will work with you to ensure that all of your intents and wishes work harmoniously to achieve your desired outcomes.