The estate planning process can feel overwhelming and forever ongoing - especially if you’re taking it on alone. As you try to address every possible question or pain point your heirs may encounter, here are a few questions of your own to consider.
Question #1: Do I Have a Will?
A will enables you to specify who you want to inherit your property and other assets. A will also enables you to name a guardian for dependents, such as children under 18 or loved ones with special needs.
Question #2: Do I Have Healthcare Documents in Place?
Healthcare documents spell out your wishes for health care if you become unable to make medical decisions for yourself. They also authorize a person to make decisions on your behalf if that should prove necessary. These documents may include:
- Living will
- Power of attorney agreement
- Durable power of attorney agreement for healthcare
Question #3: Do I Have Financial Documents in Place?
Certain financial documents can outline your financial wishes. If you become unable to make decisions for yourself, these financial documents can be structured to empower a person to make decisions on your behalf. These documents may include:
- Joint ownership
- Durable power of attorney
- Living trusts
Question #4: Have I Filed Beneficiary Forms?
In some cases, naming a beneficiary for bank accounts and retirement plans makes these accounts “payable on death” to your beneficiaries. In other cases, you will need to fill out a “Payable on Death” form.
Question #5: Do I Have the Right Amount and Type of Life Insurance?
When was the last time you assessed your life insurance coverage? Have you compared the life insurance benefit with your financial obligations?
Keep in mind that several factors will affect the cost and availability of life insurance, including age, health and the type and amount of insurance purchased. Life insurance policies have expenses, including mortality and other charges. If a policy is surrendered prematurely, the policyholder also may pay surrender charges and have income tax implications.
Consider determining whether you are insurable before implementing a strategy involving life insurance. Any guarantees associated with a policy are dependent on the ability of the issuing insurance company to continue making claim payments.
Question #6: Have I Taken Steps to Manage My Federal Estate Tax?
If you and your spouse have more than $23.4 million in assets (for 2021), you may want to consider taking steps to manage federal estate taxes, which will be due at the second spouse’s death.1
Question #7: Have I Taken Steps to Protect My Business?
If you’d like your family to continue running the business, do you have a family succession plan in place? If you own a business with others, you may also want to consider a buyout agreement.
Question #8: Have I Created a Letter of Instruction or Intent?
A letter of instruction is a non-legal document that outlines your wishes. A strong, well-written letter may save your heirs time, effort and expense as they administer your estate.
Question #9: Will My Heirs Be Able to Locate My Critical Documents?
After your passing, your heirs will need access to the specific documents you have created to manage your estate. These documents may include:
- Your will
- Trust documents
- Life insurance policies
- Deeds to any real estate, and certificates for stocks, bonds, annuities
- Information on your financial accounts and safe deposit boxes
- Information on your retirement plans
- Information on any debts you have: credit cards, mortgages and loans.
Depending on the size and complexity of your estate, preparing for your passing can be a complicated process. Consider working with a knowledgeable estate management professional who can help address potential tax obligations, division of property, insurance options and more.
Jeff Spitzmiller is the CEO of Ohana Wealth & Life Planning based in Cincinnati, OH. Ohana specializes in life and financial planning along with ESG (Environmental, Social, Governance) investing principles. The firm is an independent financial advisor and a fee-only fiduciary. Jeff and the firm also enjoy volunteering and giving back to the local community. You can reach Jeff at firstname.lastname@example.org.
This was prepared by Ohana Wealth & Life Planning; a federally registered investment adviser under the Investment Advisers Act of 1940. Registration as an investment adviser does not imply a certain level of skill or training. The oral and written communications of an adviser provide you with information about which you determine to hire or retain an adviser. Ohana Wealth & Life Planning Form ADV Part 2A & 2B can be obtained by written request directly to: Ohana Wealth & Life Planning 212 East Third St. Ste. #100 Cincinnati, OH 45202. All opinions and estimates constitute the firm’s judgment as of the date of this report and are subject to change without notice. This is provided to investment advisory services clients of Ohana Wealth & Life Planning. It is not intended as an offer or solicitation with respect to the purchase or sale of any security. Investing may involve risk including loss of principal. Investment returns, particularly over shorter time periods are highly dependent on trends in the various investment markets. Past performance is no guarantee of future results. The information herein was obtained from various sources. Ohana Wealth & Life Planning does not guarantee the accuracy or completeness of such information provided by third parties. The information given is as of the date indicated and believed to be reliable. Ohana Wealth & Life Planning assumes no obligation to update this information, or to advise on further developments relating to it. This is for informational purposes only. It does not address specific investment objectives, or the financial situation and the particular needs of any person. An index is a portfolio of specific securities, the performance of which is often used as a benchmark in judging the relative performance of certain asset classes. Indexes are unmanaged portfolios and investors cannot invest directly in an index. An index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the performance shown.