The average person spends plenty of time planning: planning their next travel destination, planning meals, planning special events like birthdays and weddings—but there’s far less attention and thought given to estate planning.
As the means for determining where your money and assets will go after you pass away, estate planning is an understandable unpopular topic, but it’s also incredibly important. With the help of a wealth management professional, you can choose how your wealth is disbursed and ensure your family and loved ones are cared for after you’re gone.
As a wealth management professional with over 22 years of experience in the financial services industry, Mark Tudor has seen firsthand how effective estate planning can either comfort a family during a rough time or worsen grief by adding stress to tragedy. Here, he outlines the benefits of estate planning from several facets.
Less Stress and Complications
The last thing your family members want to be dealing with in the event of your passing is a ‘messy’ or complex settling of an estate. Unfortunately, many leave the settling of their estate to their family, allowing it to worsen the burden of existing grief.
Outside of ensuring that financial stress is reduced during an already burdensome time, consulting with a professional regarding your estate also protects your family from wealth-dispute-related conflicts that may otherwise arise after your passing. Decisions regarding how the elements of an estate will be allocated can tear apart a family in a time when they most need to come together.
With the help of an estate planning professional, you are not only able to have control over how your wealth is allocated, but also dictate specific conditions regarding its use. Mark Tudor reports that in many cases, skilled estate planning can protect beneficiaries from bad money management or overbearing spouses you worry may wrongfully try to squander the inheritance.
Additionally, if the beneficiary is a minor, an estate planning professional can help you designate a guardian and trustee who will ensure your wealth is used as you intended after your passing. Besides helping to care for the minor after you can no longer be physically present, this also helps prevent discord in the family regarding the money’s use.
You don’t want your hard-earned money and assets to wind up surrendered to the government in the event of your passing; likely, you’d rather put that wealth into the pockets of your loved ones so it can help care and look after them long after you’re gone.
According to Mark Tudor, one of the most common reasons that individuals choose to plan their estate actively is to save their loved ones from the stress and costs of probate. With planning, measures like writing a living trust and naming beneficiaries on retirement accounts, you can rest assured that your wealth won’t be squandered by court fees or held from your family for extended periods.
Reduced Taxes and More Inheritance Money for Your Family
Effective estate planning can significantly reduce federal estate taxes or state inheritance taxes, which means more wealth goes directly into the pockets of your designated beneficiaries. In fact, with smart planning, Mark Tudor asserts that most married couples are capable of minimizing and even eliminating estate taxes altogether through the employment of AB Trusts or ABC Trusts. When fewer taxes are incurred, your spouse, children, or other designated beneficiary will be entitled to a larger inheritance.