There are a number of relatively easy steps which can be taken in order to simplify your estate plan, thus saving time and money for you and your family.
It is not uncommon to have many separate savings accounts, mutual funds and brokerage accounts, and certificates of deposits held by a variety of institutions. Consolidating your accounts will certainly make it easier to monitor them. Additionally, in the event of your death or disability, it will save your heirs a great deal of time and energy in collecting and managing your assets. Eliminating bank accounts and putting those funds into investments accounts is also a good idea, since brokerage houses and mutual fund companies are usually easier to deal with than banks.
Another step that can be taken in order to streamline your affairs is to compose a detailed list of your assets, with account numbers, phone numbers, and other pertinent information, and then update the list form time to time. This will provide you with a quick reference in the event you need to engage in financial transactions. All too frequently a family member passes away or becomes disabled and no one has information regarding the location or nature of the assets. This is particularly true with life insurance policies, as these can be difficult to track. This lack of knowledge often leads to assets never being found by the family, and they then revert to the state.
Making sure your estate planning documents (i.e, a will and/or trust, health care proxy, living will and power of attorney) have been properly drafted, updated, and still adequately reflect your wishes, is extremely important. It is also essential that you periodically check your beneficiary designations on annuities, life insurance policies, IRAs and other types of retirement accounts, to ensure they properly reflect your desires and estate planning goals. Clients often overlook these beneficiary designations, and assume that the terms of their will or trust will determine where these assets pass. The fact is that beneficiary designations and joint ownership designations supersede the terms of one’s estate planning documents. If you have moved or purchased property in another state, you should consult with an attorney in order to determine what modifications to your estate plan may be required. Often, a revocable living trust is advisable in order to avoid a second probate proceeding, and health care documents may need to be revised.
In summary, it is important to take the time to periodically review your estate plan with an experienced attorney to ensure that your wishes will be effectuated and that adverse tax consequences are minimized.
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