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7 CRITICAL TIPS FOR ESTATE PLANNING

Helping people make smart financial decisions

IN THE PRESS:


APRIL 2023

Beyond retirement, estate planning is one of the most important (and
complicated) financial decisions a person can make, made even more difficult by
the emotions driven by contemplating one’s own mortality.

A Google search for “estate planning” results in more than five billion entries,
while “estate planning services” populates another three billion. As the search
results indicate, knowing where to start is often the toughest task of all.

Before sitting down on your own to determine how best to distribute your assets
to your heirs, we recommend speaking with a fiduciary financial advisor. These
financial professionals can help you assess what you have and how best to
transfer your assets in the most tax efficient way.

SmartAsset’s free quiz simplifies the time-consuming process of finding a
financial advisor. The short questionnaire can help match you with up to three
fiduciary financial advisors, each legally bound to work in your best interest.
Advisors are rigorously screened through our proprietary due diligence process.

Here’s our take on seven critical steps for estate planning.

1. Define your objectives.

Estate planning has a straightforward yet daunting goal: to record a plan for
distributing your life’s assets upon your death. Such a task is multifaceted. It
encompasses elements of money, taxes, family dynamics and emotions.

Define your objectives early. What’s your ultimate goal? To reduce strife
between relatives after your passing, to minimize taxes, to support your
favorite charities?

Start with your intentions, and your next steps will be clearer.

2. Inventory your belongings.

Before you can assign beneficiaries to what you own, you need to take stock of
what you have.

Your assets include both the tangible and intangible, such as:

 * Homes, land and real estate
 * Cars/boats
 * Collectibles/antiques
 * Sentimental family heirlooms

 * Practical possessions (clothing, books, tools etc.)
 * Bank accounts
 * Investments
 * Life insurance policies

3. Consider your values.

After you’ve taken stock of what you have, take stock of what you want to leave
behind. What legacy, memory, or impact do you want to make?

Perhaps, as a first-generation degree holder, you have a high value for college
education. Or, perhaps, you want nothing more than to enable the generations
that follow you to have enough for down payments on their homes. What do you
value?

4. Brainstorm your beneficiaries.

In most states, next-of-kin are the standard estate beneficiaries when a will
doesn’t exist. But such a standard may not align with your wishes.

Perhaps your life has been enriched by a few close friends. Make a list of the
people you’d want to receive a piece of your estate, then consider the legacy
you wish to leave with them, both practical and meaningful.

Empowering people to make smart financial decisions.



Empowering people to make smart financial decisions.

5. Prepare your inheritors' tool chest.

This is the step that makes estate planning complex.

Tax implications hold significant power over the final value of inherited funds,
while medical coverage, life insurance policies, and other financial tools can
be the difference between using up your resources in your final days versus
retaining a nestegg to pass along.

Among the list of medical and legal considerations you should evaluate with a
professional are the following:

 * Life insurance
 * Trust
 * Power of attorney
 * Medical Care Directive (a.k.a. DNR)
 * Tax implications

6. Enlist the advice of a pro.

If the above duties sound daunting, they can be. This is where a financial
advisor can help. A licensed fiduciary is legally obligated to act in your best
interest, and can help navigate the ins and outs of estate taxes, life
insurance, wills and trusts, and more. Getting the right advice at the right
time could save your beneficiaries significant tax liability, and make the
process less stressful.

Don’t know where to look? Try our free financial advisor matching quiz. You’ll
answer a few questions and then be matched with up to three fiduciary financial
advisors. You can compare your advisor matches based on their specialty,
pricing, and more.

7. Don't "set it and forget it."

A quality estate plan should always be updated. Beneficiaries’ needs change, as
do tax laws. A will is a plan to reevaluate regularly. Our advice? Don’t do it
alone. We recommend speaking with a financial advisor, and evaluating your
estate plan together.

Click Your State to Get Matched With Financial Advisors Who Serve Your Area
After you choose your state and answer a few questions, you can compare up to
three advisors that serve your area and decide which to work with.
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registered or chartered as fiduciaries ("Adviser(s)") with a regulatory body in
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adviser. The Service is intended only to assist you in your understanding of
financial organization and decision-making and is broad in scope. Your personal
financial situation is unique, and any information and investing strategies
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Accordingly, before making any final decisions or implementing any financial
strategy, you should consider obtaining additional information and advice from
your accountant or other financial advisers who are fully aware of your
individual circumstances.

We do not manage client funds or hold custody of assets, we help users connect
with relevant financial advisors.

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