Over the next few decades, an estimated $84.4 trillion will be transferred through estates, but 28% of high-net-worth investors currently lack a solid plan for this transition.1 While estate planning can sometimes feel overwhelming, taking the time now to organize your affairs is an invaluable investment in your family’s future. This guide will introduce the foundational elements of estate planning to help you better understand how we, as your advisors, can assist in crafting a plan that preserves your legacy, minimizes potential taxes, and ensures your wishes are honored.
Drafting a Will: Protecting Your Wishes
A will is often the cornerstone of an estate plan. This legal document allows you to specify how you’d like your assets to be distributed after your passing. Beyond asset distribution, it is where you can name guardians for minor children, specify charitable bequests, and provide clarity that can reduce family conflict. Without a will, your estate could be distributed according to state laws, which may not align with your intentions.
Over a third (35%) of U.S. adults report witnessing or experiencing family disputes due to insufficient estate planning.2
If you, like so many others, have a will that you haven’t looked at in ten or more years, now could be a good time to review it. Start by asking yourself:
- Have my family circumstances or priorities changed? Over the past decade, family dynamics may have shifted—children might now be financially independent, new grandchildren may have arrived, or relationships may have evolved. Reassessing who you wish to provide for, and in what way, is crucial to ensuring your estate reflects your current priorities.
- Are there any new assets, or have any assets changed in value? Since your original will was drafted, there may be new accounts, properties, or valuable assets not covered by the existing document. You’ll also want to consider whether the total estate value has grown or shifted significantly, which could affect tax implications or how assets are allocated among beneficiaries.
Establishing a Trust: Enhancing Privacy, Control, and Tax Efficiency
Trusts offer added flexibility and control over how and when your assets are distributed. They’re particularly useful if you want to leave assets to grandchildren in stages or ensure continued care for a family member with special needs. Trusts can also provide privacy (unlike wills, which become public records) and help bypass the probate process, allowing your loved ones to avoid potential delays and court expenses.
Probate consumes up to 10% of an estate’s value and takes months or even years to finalize.3
Trusts also allow assets to transfer to heirs in a way that minimizes estate taxes and preserves wealth. By placing assets in a trust, you may shield growth from direct estate tax implications, as the trust assets typically grow outside of the estate. Additionally, trusts can enable strategic gifting to family members, allowing you to maximize annual tax exemptions while securing a structured legacy.
Designating Beneficiaries: Keeping Plans Up-to-Date
Many of your assets, such as retirement accounts, life insurance policies, and payable-on-death accounts, allow you to designate beneficiaries. Ensuring these designations are current and aligned with your overall estate plan is essential. Regular reviews are key, especially after significant life events, like the birth of a grandchild, a marriage, or a divorce.
Healthcare Directives and Power of Attorney: Preparing for the Unexpected
A comprehensive estate plan isn’t just about what happens after you’re gone—it’s also about ensuring that your wishes are followed if you become unable to make decisions. A healthcare directive (or living will) outlines your medical preferences, while a durable power of attorney appoints someone you trust to manage financial matters on your behalf. These documents ensure that your values and intentions are respected, even in challenging times.
Begin Planning Today for Peace of Mind Tomorrow
Creating an estate plan that reflects your values, family dynamics, and financial goals is deeply personal, and it’s something we take seriously. As your trusted advisors, we can help identify and coordinate estate planning resources that would be a good fit for you and your family.
Whether you’re updating an existing plan or starting from scratch, taking action today is the best way to ensure your legacy aligns with your wishes. Reach out to us to start the conversation.
[1] https://www.justvanilla.com/blog/estate-planning-statistics-and-facts-you-need-to-know
[2] https://www.justvanilla.com/blog/estate-planning-statistics-and-facts-you-need-to-know