Five Estate Planning Steps From a Wealth Adviser to Protect Your Family

ARTICLE SUMMARY: Jamie Carroll writes:

1. Create a Comprehensive Estate Plan

   Develop a solid estate plan using either a will, a trust, or both. While wills are simple and affordable, trusts can help avoid probate and provide tax planning benefits. For families with minor children, a will is crucial for specifying guardianship.

2. Leverage Digital Tools

   Utilize digital platforms like Cake (a free online tool) or GoodTrust to securely store and organize important documents, passwords, and end-of-life preferences. These digital vaults make it easier for family members to access critical information during difficult times.

3. Invest in Appropriate Life Insurance

   Choose life insurance that protects your family's financial future. Consider term life insurance for cost-effective short-term coverage, or explore whole life or universal life policies for longer-term financial protection and potential cash value growth.

4. Optimize for Taxes and Open Communication

   Work with a financial adviser to minimize tax liabilities, especially for high-net-worth families. The current federal estate tax applies to estates exceeding $13.99 million. Most importantly, create an open dialogue with family members about your estate plans to prevent future disputes and ensure your legacy is understood.

   Disclaimer: Always consult with financial, tax, and legal professionals familiar with your unique circumstances before making financial decisions.