The Recipe for a Complete Estate Plan
By: Barry E. Haimo, Esq.
February 15, 2014
There is no cookie-cutter approach to planning for your family’s future because each family and their circumstances are unique. Moreover, unless you have a crystal ball, the future is uncertain for everyone. What can you, however, is create a framework that will evolve with your family.
A huge component of an effective estate plan is having the right professionals collaborating together as a team to represent your family’s best interests and achieve your goals. In other words, the documents and vehicles are important, but the people with whom you seek counsel are critical. Haimo Law strives to develop life-long client relationships and believes team collaboration is absolutely vital to properly serve clients. Said differently, the ultimate representation is a function of having excellent professionals working together as a team to meet your family’s and business’ needs. With each of these professionals, you can expect to spend hours together getting very personal.
- Financial planner
Attorney (Estate Planning)
A basic estate plan consists of the following documents and can come in a variety of forms.
- Last Will and Testament – http://www.youtube.com/watch?v= tUi8T8ll4wI
- Trusts (rev trusts, irrevocable trusts, dynasty trusts, grantor trusts, defective grantor trusts) – http://www.youtube.com/watch?feature=player_embedded&v= tGBd1olqIe8
- Power of Attorney – http://www.youtube.com/watch?v= KICpGOiCpsk
- Health Care Surrogate – http://www.youtube.com/watch?v=KICpGOiCpsk
- Living Will – http://www.youtube.com/watch?v=KICpGOiCpsk
- Life Insurance (term, permanent/whole life)
- Annuities (immediate, deferred, investment component)
- Disability Insurance
- Long-term Care Insurance
- Diversified Investments (may be incorporated into the above instruments)
Usually these vehicles are chosen based on the client’s risk tolerance, age, financial situation and other goals.
An accountant is more advanced and competent than a book keeper.
A CPA is more specialized and better trained than an accountant. In fact, a good CPA will minimize taxes and wasteful expenses by taking advantage of current tax laws. For example, the Affordable Health Care Act introduces new taxes into the mix, including a 0.9% medicare surtax, a 3.8% net investment income tax and increases capital gains rates. The bottom line is that your accounting professional needs to be on the same page as your estate and business attorney and your financial professional or you’re in for real trouble.
Other Critical Ingredients
- Good communication with your family. Let them know your plan, designated fiduciaries, your financial affairs and the name of your professionals in advance. Make them aware of where you store important things, such as legal documents and invaluable possessions. In our digital world, this needs to include storage of passwords to online accounts and precious photo albums, especially those having monetary value.
- Good communication with your fiduciaries. Make sure they know their roles and responsibilities in advance.
- Attentiveness to your planning every few years or after significant life changes, both positive and negative.
Disclaimer: the above is merely a framework for an excellent estate plan. Every person and family has different circumstances that may justify a different approach.
Barry E. Haimo, Esq.
Strategic Planning With Purpose
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