Estate planning carries out your wishes after you die

Apr 9, 2020 | Estate Planning

It takes planning to assure that your property is safeguarded and managed if you become sick or die. Estate planning can assure that minor children are protected in an emergency and that your beneficiaries pay lower taxes. Effective planning can also avoid the expense and inconvenience of probate in New Jersey.

Most everyone, regardless of their wealth or age, should take part in this planning. Many effective steps may not be expensive or time-consuming.

First steps

This planning requires some thinking and document gathering. First, get your important documents and let important family members now where these are located so they are accessible, especially in an emergency.

Next, make a list of all your property and debts such as a mortgage. The value and benefits of insurance policies also need documented. The worth of property, collectibles, jewelry and other assets must be recorded. Bank and retirement account statements should be printed.

Next, prepare a list of estate planning objectives. These include the individual who will receive assets, anyone who will receive property if anything happens to beneficiaries, whether anyone needs to make decisions for minors and who should handle your property if you are incapacitated.

Revocable and irrevocable trusts

A trust can be an effective estate planning tool. Revocable trusts allow you to control its assets and help avoid probate. An irrevocable trust takes away control but allows you to gift assets to lower the grantor’s taxable estate. Trusts need to be carefully reviewed because there are estate, tax and financial consequences.

Updating documents

Wills, trusts and powers of attorney give you more control of what happens instead of judges, relative and tax authorities. To be effective, however, estate documents should be reviewed and updated after the birth, death or divorce of any member of your plan. This should also occur when there are any substantial changes in finances or relevant laws. Beneficiaries should also be updated to assure that assets are not allocated to unintended recipients such as a divorced spouse or deceased relative.

An attorney can help develop a plan that meets your needs. This can help assure that your heirs receive property with less expense and complications.