Non-Probate Assets Are an Important Part of Your Plan

This article reminds us of how important it is to make sure you are naming your beneficiaries properly. Pay on death accounts or accounts with a death beneficiary are an important part of your estate plan. They are meant to pass property, such as life insurance proceeds, or retirement accounts, without the need to go through the probate court. But, since they are not governed by the court, you need to make sure that you are naming your beneficiaries properly.

For example, when I have a couple with young children, I normally recommend a living trust as the corner stone of the estate plan, so money can be managed for the children should the parents meet an early demise. But, for most young couples, their "wealth" will be held in pay on death accounts like life insurance. For the plan to work, the couples have to change their beneficiaries to the trust.

Likewise, it is important on major life events to change the beneficiaries of the accounts. Such events include a marriage, a divorce, a death in the family, or some similar event. It is a good idea to review the beneficiaries regularly to make sure your estate plan is working the way you intend it to work.

Young Families Need a Good Plan

Estate planning is not just for more established people, who want to direct who gets their money. Families with young children have special reasons to plan. Parents need to plan to make sure that their children are protected and cared for.

Your estate plan is not just about money. You can name whom you want to act as the guardian of your minor children should you meet an early demise. This avoids leaving the decision entirely to a judge who knows nothing about you. Your estate plan can include instructions to your child's guardian on how you would want your children raised, and what values are important to you.

For a young family, a good estate plan should also include a method to manage money until the child reaches an age when he or she can be more responsible. This is often done through a trust, which can act as the beneficiary for insurance policies and retirement accounts. You can appoint a trusted person to manage the money, and instruct that person to cooperate with your child's guardian.

Young families should contact an attorney early, and make sure that their children are protected.

Even Those With Less Than $1 Million Need to Plan

This article explains what estate planning is, and why even those without $1 million need to plan. For Virginia residents, anyone with more than $50,000 in assets needs to plan. I have seen estates worth around $100,000 incur over $10,000 in estate administration costs. Spending $2,000 or less to consult with a lawyer can save both the expense and the hassle.

Article on Why Women Need to Do Estate Planning

More and more of the clients coming to me to consult about estate planning are women, which I think is a good sign. Whether it's to plan after a divorce, to protect from the credit problems of a spouse, or just to make sure that minor children are protected in the event of something tragic, it is extremely important that women explore their options and take action. This article in Forbes is a good explanation of the importance of estate planning.

The 25 Documents You Need Before You Die

The 25 Documents You Need Before You Die