Here’s Why Timely Estate Planning Is Important
It’s a common misconception that writing a will is the same as planning your estate. An estate plan goes beyond a will. Other than a beneficiary designation, it also includes the durable power of attorney, medical derivatives, and trust establishment.
Let’s explore the subject matter further:
What is estate planning?
Anything that you own and plan on bequeathing to your legal beneficiaries after your death is said to be your estate. Your estate includes your home and other real estate, vehicles, cash reserves, bank accounts, insurance policies, and any other possessions. A well-devised estate plan is like a written record that enlists the beneficiaries, talks about how the estate will be distributed, and responsible for handling the affairs. Your estate plan is like a written record that mentions your intentions and wishes regarding how you want your assets to be distributed after your death.
Estate planning avoids family troubles
Not investing in timely estate planning will only create a massive mess for your family. If you die without having the details of your estate in writing, it could initiate a full-fledged war between your family members. This usually happens when one of the beneficiaries thinks they deserve more than the rest or should be in charge of the finances. By sorting out the matters on time, you’ll make sure your family members don’t end up in court, up against one another. When you appoint an estate administrator during your life, you can guide them well and ensure that they’re well-prepared to handle your assets the way you’ve intended.
Reduces tax liability
You’d naturally want your beneficiaries to be able to skim off most of the estate. If you don’t plan your estate on time, they might end up losing a big bite of it in the form of taxes. Some assistance from a financial advisor and estate tax planner will help you protect your beneficiaries from the tax burden. What makes it worse is that the estate taxes need to be paid by the deceased person’s heirs. Through timely planning, you can pay the taxes yourself on their behalf. You can also help them avoid taxes by setting up a trust, establishing a joint account, or making irrevocable gifts.
If you’re based in Edmonton, Faber LLP is offering specialized trust and estate planning services. We will make sure your legacy is well-aligned with your vision. Let’s get started.