Many of us are failing to put a plan in place.
Having an estate plan is good for our finances and for our heirs, but many of us fail to put a plan in place.
However, those who do have a plan often make mistakes that can lead to familial and financial problems further down the line.
When it comes to estate planning, the most common mistake people make is the most simple: they fail to do it. Some people feel intimidated or afraid when thinking about death, others don’t want to initiate a difficult conversation with a spouse, while others simply don’t know where to start.
So what are some of the basic estate planning needs that everyone should address?
Writing a Will
This is especially important if you have children, as it ensures that you, rather than the courts, are responsible for naming their guardians. Pay particular attention to who you name as executor.
Durable power of attorney for potential healthcare needs You don’t want the state making ‘do or do not resuscitate’ decisions on your behalf.
Durable power of attorney for financial matters
Be clear about whether you want this to be immediately effective or ‘springing’, which means it isn’t effective unless you are incapacitated. Make sure this is allowable in your state of residence.
Your goal with these base documents is to avoid probate and the painful situation of having outside legal entities making decisions about one of the most intimate moments of your life.
Estate planning can get much more complicated than this, especially for those who have the nice problem of having net assets that exceed estate tax exemptions. But for the vast majority of people, establishing these basic documents will go a long way toward making wealth transfer as easy as possible for loved ones.
Helping you address the issues
It’s easy to think about personal finance as investing. That certainly is one element of it, but so too is budgeting, retirement income planning, tax optimisation, risk management and estate planning. We can help you tackle estate planning in a coordinated manner to keep vital details from falling through the cracks.
For more information, please contact PK Partnership on 020 8681 4994.