Creating an Estate Plan
Estate planning can be an effective way of maximizing the assets an individual wishes to pass on to their beneficiaries. It is also a means of helping to ensure that an estate is distributed to loved ones in the way an individual chooses. It is important to consider many factors when creating an estate plan.
Making an Inventory of Assets and Liabilities
Creating a family inventory should form part of the estate planning process. This document needs to include information regarding the current financial status of the family, including details concerning financial accounts, investment-related debt, digital assets, insurance and annuity, and non-registered investments.
Estate Planning Objectives
Considering questions such as who the beneficiaries of the estate are and when the individual wishes these beneficiaries to receive their inheritance is an important part of drafting a list regarding estate planning objectives. This list can form the basis of a guide to help ensure the estate planning remains in alignment with the individual’s personal and financial goals.
Succession planning experts such as Dr Edgar Paltzer know that it is also crucial for the individual to think about how they want their assets to be passed on to their beneficiaries and whether a portion of their assets should be given to charity or earmarked for their own retirement plan.
Determine the Actions Required
The next stage of estate planning is identifying the actions that need to be taken to achieve the objectives detailed in the plan. Creating a will is the most important step, but there are other things that could be considered, such as making changes to the legal ownership of assets.
Consult with Advisors
The assistance of professionals — such as a lawyer, accountant, trust officer or wealth planner — may be required to ensure the estate plan is properly executed. Wealth planners and advisors can identify specific tax and legal issues and point the individual towards the professionals they should consult with, with a view to creating a comprehensive estate plan.
Periodic Reviews
Undertaking periodic reviews of the estate plan is important to ensure that it continues to meet its objectives. Family events, like a marriage or the birth of a child, could also be a trigger for a review of an estate plan. It is crucial to ensure that any revisions made to an existing plan are valid and made in the presence of witnesses, such as lawyers or tax advisors.
Take a look at the embedded PDF for more information on creating an estate plan.
