An effective estate plan has many benefits. In the broadest sense, estate planning includes the process of accumulating, managing, and distributing property over the course of a lifetime. Satisfaction comes from knowing your objectives, taking practical approaches to achieve them, and avoiding hazards in the process.
An effective estate plan involves recognizing and coping with four financial challenges:
1. Dying Too Soon. For those with a sense of responsibility to loved ones, one of the greatest concerns is providing for them. Savings plans, retirement accounts, life insurance, and estate plans are just a few of the ways to assure financial security for loved ones.
2. Outliving One’s Resources. As time passes, the possibility of outliving one’s financial resources can be a concern. Many people will reduce what they spend today to ensure that they have ample funds for the later years. It can be a challenge to balance present and future needs.
3. Emergencies. Estate planning may ease the hazards of illness, accidents, and other unforeseen economic hardships. We can accumulate savings in order to be prepared, but insurance assumes greater importance as costs increase. Medical, automobile, homeowners, and other insurance policies can help lessen the possibility that an emergency will unnecessarily deplete economic resources.
4. Mental and Physical Disability. It is vitally important to plan for adequate income and management of assets, in the event that a mental or physical disability impairs a person’s ability to manage his or her property. A number of financial arrangements, including various types of trusts and powers of attorney, can be created to help deal with the need for assistance in asset management. These trusts can also be set up for disabled family members.
Addressing each of the above concerns is the essence of an effective estate plan. Many people view estate planning, and particularly addressing the above concerns, as an overwhelming task. A good estate planning attorney can help bring order to what may otherwise seem to be too difficult to accomplish on your own.
Your estate planning attorney will take an organized approach to decide what is needed. Your attorney will help you focus on the “essential elements” of estate planning – the people in your life, the property you own, your plans for the future, and the persons who will assist you in achieving your goals.
Like a building project, with the help of your attorney, you will start with your “blueprint” for setting out a plan. You will determine the essential elements. In a few short days or weeks, your plan can become a reality.
Jeffery J. McKenna is a local attorney serving clients in Nevada, Arizona and Utah. He is a shareholder at the law firm of Barney McKenna & Olmstead, PC, with offices in Mesquite and St. George. If you have questions you would like addressed in these articles, you can contact him at (435) 628-1711 or jmckenna@barney-mckenna.com.
