On December 2, 2013

In a recent report, an attorney and a wealth adviser asserted that citizens in Colorado and other parts of the United States might need to change the way they are preparing for the future. Although estate planning was once solely the domain of the exceptionally wealthy, the attorney noted that anyone who owns property, has children or could inherit money in the future should engage in some level of estate planning.

In addition to promoting estate planning as a general practice, the advisers said that modern plans needed to focus on more than just reducing tax obligations. Although tax-mitigation strategies once made up the bulk of planning activities, increasing life expectancy now necessitates additional elder law planning. The attorney suggested that naming a power of attorney, designating healthcare proxies and assigning guardians for one’s children were essential practices for anyone who wanted to ensure that their instructions would be followed regardless of their income and holdings.

Coloradans were also cautioned to be thorough in the identification of their assets and evaluation of their plans. In addition to holdings like retirement savings, the attorney advised that people keep tabs on the cash value of any real estate, corporate investments and insurance policies they wanted to entrust to their loved ones after death.

Planning for the future can be difficult without guidance. Estate taxes and inheritance laws may reduce the amount of property that is actually received by one’s beneficiaries, and it is hard to foresee the effects that future rules will have on plans. Changes in one’s personal situation, such as childbirth or spousal separations, might make people reconsider their beneficiary designations and reduce the efficacy of old plans. Attorneys may be able to help these individuals provide for their loved ones by coming up with a plan that meets their current goals yet remains flexible.

Source: Forbes, “How To Inherit Wealth Without Screwing Up“, Larry Light, November 22, 2013

Categories: Estate Planning

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