By Linda Marshall, Esq

Estate planning is about caring for your loved ones, seeing they are provided for, and making sure your hard-earned property is distributed according to your wishes.  An estate plan is your blueprint for where you want your property to go after you die, how you want it distributed, and the marching orders for those you select to manage your affairs after you die or become incapacitated.

What is included in your estate?  Your estate consists of all your property, including:

  • Your home and other real estate owned,
  • Tangible personal property such as cars and furniture, and
  • Intangible property such as insurance, bank accounts, stocks and bonds, and pension and Social Security benefits.

So, what is an estate plan?  When most people think about an estate plan, they think of a will.  But a will is far from the entirety of an estate plan.  Estate plans may include:

  • Durable powers of attorney for finances
  • Durable powers of attorney for health care
  • Health care directives
  • Living trusts, including:
    • Revocable living trusts
    • Marital trusts
    • Special needs trusts
    • Other types of trusts
  • Wills
  • Nonprobate transfers
    • Beneficiary deeds
    • Transfer on death designations
    • Beneficiary designations (such as for IRAs and insurance policies)
    • Joint ownership

An estate plan should be designed for your individual situation and should meet your personal goals.

If you do not have a will, the state has one for you.  In Missouri and Kansas, if a person does not have a will or estate plan, half of anything he or she owns at death passes to the surviving spouse and the other half goes to the children.  If the children are under the age of 18, a court-supervised conservator administers the children’s share of the estate.

Most parents do not believe that the age of majority set by the state (age 18) is old enough to have control of substantial amounts of money, so they want to protect their children by setting a higher age.  This can be done by a trust.  A trust can delay distribution of assets to children until the children reach what the parents consider a more suitable age, and the trust can name a financially mature trustee to manage the property in the interim.  The trustee can be given flexibility to expend trust funds for the children’s needs, such as support, education, and unforeseen circumstances.  If a child is disabled, a “special needs” trust can be established that will supplement government assistance rather than replace it, enhancing the quality of the beneficiary’s life without jeopardizing the existing benefits.

A revocable trust offers all the advantages of avoiding probate but still allows the person to direct how their property is to be distributed, including alternate provisions attempting to anticipate varying scenarios of life and death. A revocable trust also can provide for how you and your assets will be cared for if you become incapacitated.

A revocable trust can be changed or revoked until the person’s death or incapacity, but it does take effect immediately upon execution and funding. This is why such trusts are often referred to as “living trusts.”

Even if a person has a living trust, however, he or she should also have a will – a last will and testament. This is because some assets may still pass by other means. The primary provision of this will is a clause (a “pour over” provision) by which any assets passing by way of the will is bequeathed to the living trust.  The will is a valuable backup to insure that everything passes as intended.

Except in rare circumstances, a surviving spouse will have no estate taxes to pay. In 2020, estate and gift tax exemptions for anyone are $11.58 million per person. So most people can plan their estate based on whom they want to inherit their property, at what time and under what circumstances, and whom they want to administer the plan now and in the future.

Creating an estate plan is a great gift to a person’s loved ones.  It organizes the assets; it protects the assets; it eliminates all of the transfer requirements after death; it saves money; and it frees your loved ones from all the administrative burdens of an unplanned estate.  It also makes sure your wishes are accomplished.  These are things we all want, aren’t they?
Don’t leave the future of your loved ones to chance, contact Linda’s office today or call (913) 951-8395 or email her at: MarshallLaw.Linda@outlook.com to see how she can work with you to structure an estate plan that ensures your wishes are respected and your loved ones are cared and provided for.

 

This does not constitute an offer to buy or sell any security. Investments in securities are not suitable for all investors. Investment in any security may involve a high degree of risk and investors should review all “Risk Factors” before investing. Investors should perform their own due diligence before considering any investment. Past performance and/or forward looking statements are never an assurance of future results. Investment products, Insurance, and Annuity products are not FDIC Insured/Not Bank Guaranteed/Not Insured by any Federal Government Agency/May Lose Value. Always read the prospectus before investing.

Securities and Advisory Services are offered through Client One Securities, LLC. Member FINRA/SIPC and an Investment Advisor. Benchmark Financial Group, LLC and Client One Securities are not affiliated companies.

Get your free guide to understanding your Federal retirement benefit options

Get the clarity you need with our free video guide on the Federal retirement benefit options available to you. Provide your name and email below and we'll send the video to your inbox.

Success! Check your inbox for your video link.