After working hard and saving smart for decades, the last thing you want is someone telling you what to do with your money—even after you pass away. If you don’t have a will in place, or if you have one but haven’t updated it since your firstborn was in diapers, control of your assets can land in the hands of probate court instead of your loved ones, preventing your family members from accessing the financial security they need to move forward.
Unfortunately, only 18 percent of seniors over age 55 have a legacy plan, including a will and healthcare directive, in place. To stand out from the status quo and protect your assets for years to come, it’s critical that you focus on your estate planning as soon as possible. Here are a few tips to keep in mind:
- First, know what you own (and owe). Many people think only in terms of savings and retirement accounts when determining their wealth. However, tangible possessions like your home, property, vehicles, and collectibles may be worth more than your liquid assets. Start by inventorying everything of value, and speak to a St. Louis financial planner to identify other possible assets. On the flip side, it’s just as important to identify any debt that might end up with a loved one after your passing.
- Have “the talk” with your family. Most people don’t really want to talk about illness or death, but communicating your wishes to your family members can help prevent miscommunication and surprises down the road. Share your plans for a living will, discuss charities you would like to support with your trust, determine which family members should serve as a trustee or medical power of attorney, and explain how you would like your assets distributed.
- Assemble your financial crew. Many seniors leave all their estate planning in the hands of a financial advisor. While a financial planner sets the foundation for your family’s financial security, adding a tax advisor and estate planning attorney to your team can help ensure all your bases are covered. For example, a lawyer can guide you through the intricacies of establishing a medical power of attorney while a tax professional helps ensure your loved ones aren’t saddled with federal or state estate taxes.
- Go for a will and a trust. Most people have a will in place to spell out how they would like their assets dispersed after their passing. However, a trust can serve to protect our finances while we’re still alive. By establishing a trust, you maintain control over your assets. If you become ill or incapacitated, your appointed trustee can handle your finances. You may also want to designate a financial power of attorney who will handle assets outside the trust—for instance, paying your bills from your checking account if you’re in the hospital or a nursing home.
- Manage your medical care. End-of-life care comes with many difficult decisions regarding a loved one’s treatment. In many cases, procedures meant to extend one’s life actually lower the quality of it, causing overwhelming pain and discomfort. A living will, or medical care directive, allows you to guide the care you’re comfortable receiving if you’re physically or mentally unable to make decisions. A medical power of attorney of your choosing can ensure those medical decisions are followed by healthcare staff.
If you haven’t started your estate plan, it’s not too late. Consider meeting first with a financial planner to establish where you currently stand financially, and then working with an estate attorney to determine how your assets will be controlled moving forward. By putting in the work today, you can save your family the stress and heartache of a court battle in the event of the unexpected.
