Plan for Your Family’s Future
Now that you have made some money from the sale of the business, you should scrutinize any plans you have made for your family’s future and for your estate. Although you may have already taken care of some of the following items, you will want to revisit these eight:
- Make a Will:You should have a will drawn up that stipulates where assets and property will go once you die.
- Add a Living Will:Many people today are drawing up living wills. These stipulate medical and health care instructions to be carried out if you are on a life-support system. A power of attorney should be named in conjunction with a living will.
- Review Beneficiaries:As your family situation changes over the course of your lifetime, you may want to change the names of beneficiaries not only on your will but also on life insurance policies and other documents that list beneficiaries.
- Provide for Child Guardianship:If you have minor children, it is imperative that you take time and special consideration when deciding who will take guardianship of your children in the event that you die. This should be stipulated in your will.
- Form Trusts:Setting up a trust is something you may want to consider to maintain greater control over your assets and have your wishes carried out once you die. Trusts will also avoid the lengthy probate process. There are a variety of trusts available.
- Navigate Logistics:It is an emotional time when a loved one passes away. Tension can be exacerbated when those closest to the deceased cannot find important documents, keys to safety deposit boxes, financial statements, and other necessary information. It is essential that you create a list of the location of all-important information and give the list to someone you trust.
- Consider Gifting:As I mentioned in the previous section, gifting is a means of giving away tax-free (subject to limits) to any person you choose. This tactic is a way of shrinking a large estate to help your beneficiaries avoid significant estate taxes.
- Establish a 529 College Savings Plan for Your Children:Much like a 401(k) is a savings plan for retirement, a 529 plan is a college savings plan—except you set these up on your own and not through your company. These state-sponsored savings plans let you build up tax-free savings for tuition in any university in the country. You will owe taxes and penalties if you use the savings for non-college-related purposes.
If you don’t already have an Estate Planning Professional, we’d be happy to connect you with one of our partners. Don’t hesitate to ask!
By: Richard Harroch, All Business
