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Estate and Family Planning in Baton Rouge FAQs

Estate Planning Goals Investments

If you’re young, estate planning might sound like something you don’t have to think about until you’re older, but the reality is, you need to think about it now. Today. It may seem a bit morbid and uncomfortable to think about what will happen to your assets when you’re gone. But in reality, if you were to die or become incapacitated before you have your financial affairs properly in order, the state in which you live in will get involved, and your wishes or intentions for anything you leave behind may not be carried out.

Having a comprehensive estate and family plan can help give you peace of mind that your family will be well provided for in the future and that your assets will be handed down according to your specific wishes.

So, where do you start?

Here are some Frequently Asked Questions when it comes to estate and family planning Baton Rouge:

What Should I Do First?

When getting started, first determine your objectives.

  • Are there specific assets you want to leave to specific friends, family members or a particular charity?
  • Should you consider future children or grandchildren?
  • Do you need to plan for college expenses for your children?
  • Do you own a business that you have to designate a plan for in the event of your death?

Think about the goals you want your complete estate plan to cover and the questions you want it to answer.

Next, evaluate your assets and consider your beneficiaries. In other words, decide who you want to get what. Make a list of everything you own of value. This can include savings, investments, retirement accounts, real estate, insurance properties and personal property like jewelry and cars.

Then designate beneficiaries. You may need to set primary and secondary beneficiaries (who will receive the assets in the event that the primary beneficiary passes away before you do), and in some cases, you might need to define your relationship to the beneficiary. You’ll need to name them on beneficiary forms, as well as on some retirement accounts, insurance policies, investments and annuities.

How Do I Write a Will?

Your last will and testament allows you to designate exactly how your assets will be distributed. You can specify how, when and to whom your assets are administered. For example, you may want to specify that your children do not receive their shares of your estate until they turn 25. Your will may also designate power of attorney, who your executor will be and who will manage your assets after your death.

You can use software or a template to create a very basic will, but if you have more significant assets, if your beneficiary designations are even remotely complicated, if you think someone might contest your will or if you have any other concerns regarding your last wishes, you should consider talking to a financial advisor and an estate attorney who specialize in wills and estate planning.

 

Ready to start a discussion about your future and financial plan? Contact Align Wealth Partners to see how we can help.

 

What Is a Power of Attorney?

When you give someone durable power of attorney, you allow them to make financial decisions on your behalf when you’re unable to. You can also appoint a power of attorney for health care decisions, which gives that person the power to make determinations regarding your medical care in the event that you are incapacitated or unable to make your own decisions. This may be part of your living will (advanced directive), which outlines your wishes concerning your care with regard to life-sustaining treatment, if you are incapacitated or unable to make your own decisions.

Discuss your health care plans and insurance needs with a fiduciary financial advisor, as he or she has a legal obligation to put your best interest first and will not try to sell you a plan for commission.

What Is an Executor?

An executor is someone you appoint who will be responsible for gathering, managing and maintaining your assets after your death. The executor will handle the administrative tasks and see to the tax liabilities of your estate, as well as the distribution of your assets to the beneficiaries you designated in your will.

What About Taxes?

In most cases, your heirs won’t be subject to federal estate taxes, unless your taxable estate is worth more than $11.4 million in 2019. If your estate value does exceed that amount, it may be subject to three types of federal estate taxes: Estate tax, gift tax and generation-skipping transfer tax.

However, all states have different estate and tax laws. When starting your estate and family planning Baton Rouge, make sure you discuss your situation with an advisor who is well-established in the Baton Rouge area.

In addition to the various federal estate taxes, your estate and beneficiaries may be subject to transfer or estate taxes, depending on where you live.

The complicated tax laws surrounding estate planning are one of the most significant reasons to consider enlisting professional help from a financial advisor. When you worked for everything you own, you want to pass down as much of it to your beneficiaries as you can, with as little taxation as possible. A financial advisor can not only help guide you in creating a comprehensive and customized estate plan for your needs, but an advisor can also help potentially maximize the ways you’re able to give, donate, contribute and transfer assets during your living years, when those gifts aren’t subject to estate taxes.

What Are Some Common Mistakes When it Comes to Estate and Family Planning?

Don’t just plan for your death. Your estate plan should also take into consideration your wishes and directives in the event that you are severely injured or terminally ill and unable to manage your own health care and business affairs. Again, without having these designations specified, state and local laws will kick in to determine who will make those decisions on your behalf.

Don’t set it and forget it. Your estate plan will continue to evolve over time, as your life changes, so it’s wise to revisit your plan on a regular basis to make necessary adjustments. For example, has your spouse passed away? It’s generally recommended to re-evaluate your estate and family plan once a year, or following a major life event, such as the birth of a child, a marriage or a death.

Don’t try to do it all yourself. You can find several free “last will and testament” templates online, and your neighbor’s best friend’s sister’s hairdresser who once thought about becoming a lawyer can probably give you some advice. But if you want to have a comprehensive estate and family plan that includes properly drafted documents and is based on the area that you live, there is no substitute for hiring a qualified, licensed financial advisor.

Estate and family planning is not something you should put off.

This information is not intended to be a substitute for individualized legal or tax advice. Please consult your legal/tax advisor regarding your specific situation. Align Wealth Partners and LPL Financial do not provide legal/tax advice or services.  Please consult your legal/tax advisor regarding your specific situation.