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Wealth Preservation Planning

Top of a will document with glasses and a red pen on top of the last willYou spent many years growing your wealth. You may be using that wealth to provide income during your retirement years. So, it is important to have a plan to determine what will happen to your wealth and assets after you die.

A significant number of people have no plan at all. Others have a plan but have not taken the steps needed to put the plan in action. These actions are essential to make your plan for after your death tangible.

At a minimum, a will is essential. Your will should clearly communicate your wishes in the case something should happen to you. Other, more detailed legal documents are often needed. For this step, an estate planning attorney is a good idea. There are do-it-yourself options too, but I would discourage going that route as these can involve many complex issues. Doing it wrong can be worse than not doing it at all.

Trust Details to Use to Your Advantage

Trusts can address issues that a will does not. While a will may address the distribution of assets after death, a trust can address issues during your lifetime. Think of how you would like your finances handled and by whom in the event you become incapacitated. While courts and state governments can – and do – make that determination for you in the absence of written directives, I think most of us agree that is not a preferred option.

Older white couple where man is shaking hands with someone off screen and his wife is sitting next to the husband smilingIf you already have a trust, it is important that your account(s) are titled accordingly (Joint with right of survivorship, Joint tenants in entirety, single name, Trust etc,). For example, if you have a trust document but keep your assets titled in a joint name, you may have excluded those assets from the trust. In addition, make your financial advisor aware you have a trust.

As a financial advisor, wealth preservation planning conversations with clients also include: who they want to inherit assets; who do they not want to inherit those assets; are there charitable organizations to consider. Clients may have a son in-law, daughter in-law or even their own child that they don’t trust. This is not uncommon and needs to be addressed when putting a plan in place.

In addition, trusts offer a wide variety of options for people to communicate their wishes. A trust can be revocable, meaning the trust can be modified to meet changing circumstances. Furthermore, you can set limits on trust distributions and even determine a time frame for those distributions.

Attorneys in the Wealth Preservation Process

dark wooden table background with a white coffee cup and white grid notebook with check boxes marked next to each "goal plan action" in the foregroundBringing an estate planning attorney into your planning process is essential to forming a secure wealth preservation plan. An estate attorney specializes in issues that address a wide array of wealth preservation strategies that you may be unaccustomed to. As mentioned previously, I feel strongly that setting up a trust is not a do-it-yourself project. In addition, the attorney may address other wealth preservation strategies such as power of attorney, living will, health care surrogate etc.

I encourage my readers to take action in preparing a wealth preservation strategy. Don’t wait until it’s too late. To determine your next step, give me a call to discuss your situation.

February 2021

Content in this material is for general information only and not intended to provide specific investment, tax or legal advice or recommendations for any individual. Please consult the appropriate professional regarding your specific situation.

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