Estate Planning - Preparation for the Inevitable
Clients often ask why they need to think about an estate plan.
They usually assume that their estate is not large enough to justify the expense of hiring an attorney to prepare documents. Or, even more often, they plan on leaving everything to their spouse which is simple, right? Wrong. This article from the New York Times titled “Death Is Inevitable. Financial Turmoil Afterward Isn’t” gives a great perspective on why estate planning and financial planning isn’t “death planning,” but instead it is preparation for the inevitable. As the article points out, traditionally men have taken care of the finances and the planning, but all too often this means that their wives are left in the dark after their death.
It is imperative that both spouses understand where their assets are and how they are managed. Estates with varying types of mortgages, pensions, bank accounts, stocks, and bonds will be handled in a different manner than an estate without any of these assets. This planning becomes even trickier if either spouse has a child from a previous marriage or if minor children are involved. Having a good team in place before you die – attorney, accountant, financial planner, etc. – and committing to open communication about the assets you own before your death ensures that the surviving spouse will have the proper guidance to navigate his or her way through a difficult and, sometimes, confusing process.
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