Not all families take the time to develop their own estate plans. But every family does, in fact, have an estate plan. How is this possible? Because if you don’t create an estate plan, the IRS and the state of Indiana will simply make one for you. They, not you, will determine how your assets are distributed after you are gone. And, your heirs may suffer painful financial consequences. This is why opting for an estate plan of your own is one of the most important financial decisions you will ever make. And, it is why it is in your best interest to have Connie Bauswell, an attorney who focuses on estate planning, create yours.
Connie can help you accomplish any and all of the following, depending on your specific needs:
- Maintain control over your affairs
- Protect your assets
- Continue to enjoy the lifestyle to which you have become accustomed
- Significantly reduce income, gift, capital gains and estate taxes
- Pass the largest possible amount of your wealth on to your heirs in accordance with your wishes
- Protect your heirs’ inheritance from creditors, predators and, in certain cases, from the poor judgment of your heirs themselves
- Keep your affairs private
- Avoid the expenses and delays associated with probate
- Pass your values and work ethic on to your heirs
- Ensure your legacy
- Protect the value of your business
Perhaps you already have an estate plan. If so, you still could benefit from a consultation with Connie. She has reviewed many families’ existing plans and found them to be inadequate or outdated. Chances are, she can make your existing plan much more effective.
Scenarios Worth Considering.
Some examples of what can happen to your children in the real world if they are inadequately protected.
A young couple with two children creates their own will with forms from a book. They leave everything to each other, and then to their children. Unfortunately, one parent dies of cancer and the other from an infection while their children are still minors. The probate court is forced to split the proceeds into two court-supervised trusts with annual accountings and appearances. The couple’s small estate dwindles rapidly due to fees and conservative financial management. Ultimately, the children run out of money in their early teens.
When you have children, a simple will is not enough.
A professional couple with substantial life insurance and their own home designs an excellent estate plan that fully protects their three children by creating highly customized, detailed trusts. But they procrastinate on choosing the backup guardian. Several months later, as their powerful documents languish in their attorney’s files, they are killed in a car accident. Although the attorney may certainly testify as to whom they wanted to raise their children, none of the documents will be admissible or have the force of law. Again, the court will place the couple’s assets into separate trusts, increasing cost and decreasing flexibility. When one of the children requires extensive therapy for injuries due to a serious fall, her trust money runs out. The trustee, court and other children are sympathetic, but fiduciary rules do not allow them to gift money from the other children’s trusts to the needy child.
We all have a deadline to complete the planning of our estates. Unfortunately, we don’t know when it is.
A couple just starting out completes a thoughtful, well-crafted plan while their first child is still in the womb. But over the years, they stop reviewing it because the plan seemed to be holding up well. What they fail to realize is that their careful saving has allowed their estate to grow to the point where it is subject to estate tax. When both die after long, well-lived lives, the federal government takes 30% of everything they owned.
Estate taxes reach as high as 55% and are changing all the time. Be sure to review your estate plan periodically.
While these stories are only loosely based on real events, the consequences described are entirely possible. If you recognize yourself in these stories, please take precautions to avoid painful and unnecessary consequences.