Start with your Name(s)
What’s in a Name? Everything. You’ll want to have all known names used by both parties inclusive of maiden names and any name that any property is listed under.
.... And then comes the kids
- Be prepared with names and dates of birth for all children of both spouses inclusive of those from previous relationships.
- Do you have any dependents other than children? You’ll want to include those as well
- Are there any dependents you wish to disinherit (sensitive topic I’m sure, but an important one to ask yourself especially if considering any loved ones who may be struggling with drug or alcohol abuse or have issues handling money)
- For your children who are under the age of 18, who would you want to raise them.
Do you have an existing Marital Property Agreement?
Have you ever filed a Federal Gift Tax Return?
Who would you want to be the decision-maker on your estate upon your death? Do you desire to compensate this person for administering your wishes? What scope or limits, if any, should this person have over your estate?
Another important factor to consider is when do you want your beneficiaries to ….well benefit from your estate? With a trust, you have the option to have the estate distributed over an extended period of time, when your 16-year-old child turns 25 for instance.
Estimated Value of the Estate
It’s a good idea to have a few important figures and numbers accessible to keep the Estate Planning process moving forward smoothly. For both you and your spouse, you’ll want to know the type of assets you have and their approximate value. Common assets can include:
- REAL ESTATE: what is the fair market value (less loans)
- SECURITIES: Stocks, bonds, mutual funds
- CASH TYPE: cash, annuities, notes that are due to you
- BUSINESS INTERESTS: sole proprietorship, partnerships, closely held corporations
- RETIREMENT: IRA, 401k. You would not include a pension or social-security here as these benefits are discontinued upon a person’s death.
- VEHICLES: cars, R.V., boats
- PERSONAL PROPERTY: Jewelry, furniture, art, antiques, heirlooms
- LIFE INSURANCE:
- who is the insured on the policy
- who is the owner
- what is the estimated cash value
- what is the face value paid upon death
- who is the beneficiary
The last major component of an Estate Plan that you should start thinking about is in regards to a Living Will, also known as an Advance Medical Directive.
This optional document is where you would answer questions regarding matters such as life support. Some hear the term ‘persistent vegetative state’ and have a strong reaction with regards to what they would want for themselves, while others may feel more ambivalent. This is the part of the Estate Plan where you would delineate those wishes. You may decide to make these determinations for yourself now to save your loved ones the turmoil should the circumstances become a reality. You may simply be unsure of what you would want and decide to leave it open. It is an entirely personal decision and should be treated as such by the person working with you on your plan.
When it comes to estate planning, a little forethought goes a long way.