IT’S SOMETHING that everyone needs, but often overlooks — estate planning. When you die, you leave your worldly possessions behind. By planning in advance, you have the say as to who receives which assets. The people you care about are more apt to receive your property.

Marc A. Hebert's Money Sense column sig

While planning is important, it does take some effort. Thinking about death is hard — it can be a very uncomfortable subject. Coming to terms with your death is probably the first step in the process. Once you do so, it may make the next steps easier to understand and approach in a more direct manner.

Your estate plan can be simple or complex. Some strategies are definitely easier to implement — like having a will, for example. Others are more complex, such as the use of trusts. Whatever your needs, most strategies will probably require you to hire a professional. This is most often an attorney who specializes in estate planning, but depending on your situation, you might also need an accountant, financial planner or even a tax attorney. Remember to weigh the costs of a strategy versus the benefits to be achieved if it is executed.

Some circumstances may need special planning attention if:

• Your estate is valued at more than the federal gift and/or estate tax applicable exclusion amount (which is $11.4 million per person for 2019)

• You have minor children

• You have others with special needs who rely on you

• You own a business

• You have property in multiple states

• You have charitable intentions

• You own valuables such as artwork or collectibles

• You have specific feelings about health care

• You want privacy and want to avoid the probate process

The first step in developing your plan is to understand your situation. Such factors as your age, health and wealth all may affect how you plan. Who are your family members? How would you like to benefit them? What do your family members need? You will want to review your tax picture and need for liquidity. You will want to have plans in place should you become incapacitated.

After assessing your situation, consider your goals and objectives. The clearer you can be concerning these, the easier it will be to decide on a strategy to address them. Some common goals include:

• Providing financial security for your family

• Preserving property for your heirs

• Avoiding disputes, whether it be among family members or business partners

• Providing for a charity

• Managing your affairs in the event of disability

• Providing liquidity to pay the expenses of your estate

• Transferring ownership of your property or business interests

An attorney can outline the alternatives available to meet your goals. Some of the documents needed to address these are a last will and testament. This is the document that states how your assets are to be distributed and who will care for your minor children. Anyone with minor children should have a will to address guardianship.

Some will need a trust to properly address their planning concerns. A trust is a legal entity that holds your assets to be used for the benefit of one or more individuals all overseen by a trustee or trustees.

Some assets may need to be correctly titled. Common examples of this is tenancy in common or joint tenancy. Each type of titling will have different legal ramifications.

Some property will have its own beneficiary designations. Examples here are retirement plans and life insurance. These types of vehicles pass according to a beneficiary designation.

Finally, once you have completed the process, don’t just put your estate plan away and forget about it. Perform a periodic review to make certain the plan still addresses your goals and your needs.

Marc A. Hebert, MS, CFP, is a senior member and president of the wealth management and financial planning firm The Harbor Group of Bedford. Email questions to Marc at Your question and his response might appear in a future column.

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