Curious about how you can secure your family’s future?
No one likes to think about what will happen when they die. Who will take care of the kids? What will happen to the house? How will your spouse get by financially?
These are all tough questions to consider. But the good news is that you can take action now to determine exactly how your affairs will be handled should the worst happen.
That’s where proper estate planning comes into play.
Take control of your family’s future and speak with an experienced Atlanta estate planning attorney about the steps you can take for estate planning at home.
An estate plan aims to set directives to ensure your wishes are honored should you die or become incapacitated. Estate planning documents can cover a range of issues, like who will care for minor children, which beneficiaries will get which of your assets and property, and who will handle your affairs when you can’t speak for yourself.
Some estate planning strategies even allow certain assets to avoid the probate process.
You see, when someone passes away, their entire estate goes through a court-supervised process called probate. It’s a costly, time-consuming, and very public process for the deceased person’s beneficiaries.
A knowledgeable estate planning lawyer can walk you through what strategies will work best for your assets, your loved ones, and your wishes for the future.
Want to take action now to get the ball rolling on your estate plan? Here are five things you can do now to prepare for your estate planning needs.
Since such a significant portion of the estate planning process involves protecting your wealth and holdings, you’ll need to know exactly what assets and debts are in your name. Many people wonder if they even have enough wealth to warrant an estate plan. Still, once they actually start tallying up their belongings, most realize they need a plan.
In order to get an accurate picture of your estate, start writing down all of your tangible and intangible assets that have value.
Intangible assets may include:
Tangible assets may include:
Regarding potentially high-value tangible assets, now is a good time to get a professional property appraisal company involved to determine their fair market value.
P.S. Don’t forget about your debts when totaling up your estate! Total any mortgages, tax debts, car loans, student loans, business loans, and credit card debt in your name.
Estate taxes are applied to the value of a taxable estate before its beneficiaries can be paid out.
Georgia is one of 38 states that do not levy estate taxes on the estates of their residents once they pass away. There is no gift tax or inheritance tax—applied to a beneficiary’s inheritance once they receive it from the estate—in Georgia either.
However, an inheritance tax from that state may apply if your heir lives in another state.
While the Peach State doesn’t subject residents to most types of taxes associated with estates and inheritances, the federal government still does. As of 2023, the IRS applies an 18%-40% tax on estates valued at over $12.92 million for estate tax purposes.
Once you’ve totaled your assets, it’s time to consider what your family members will need should you pass away or become incapacitated.
You may decide to take out more life insurance coverage, establish your wishes for the care of your children, or even set up instructions and funds for a special needs family member.
Now comes the process of deciding which estate planning strategies may work for your estate.
For example, you may decide that you need to place certain assets in a revocable living trust to ensure they bypass probate court and pass directly to your heirs. You might also want to ensure the right person is designated to handle your affairs should you not be able to.
Many assets—like life insurance policies, retirement plans, and even “payable on death” bank accounts—might already have individuals assigned as beneficiaries. Make sure you review these beneficiary designations and ensure they are in line with your wishes.
You’ll also want to decide on a beneficiary designation for each of your assets that don’t have one built-in, like real property, vehicles, and financial accounts.
The great thing about an estate plan is that it can be tailored to meet your family’s needs and your wishes.
There are several components to a robust estate plan, so let’s talk briefly about each of the most common ones.
Almost everyone needs a Last Will and Testament. This estate planning document outlines your wishes for who will receive your assets, who will care for your children, who will manage your financial affairs when you can’t, and even how your funeral and burial will be handled.
In Georgia, a will must be:
A trust is an arrangement in which a third party (the “trustee”) holds onto assets on behalf of those who initially owned them (the “grantor”) and those who will inherit them (the “beneficiaries”). Having assets or funds in a trust allows them to bypass probate and pass directly to the beneficiaries.
A revocable trust can be altered or canceled at any time during the grantor’s lifetime.
When a person becomes incapacitated due to illness or injury, someone still needs to handle their affairs. A financial power of attorney can be designated to manage the incapacitated person’s finances and other affairs.
While a financial power of attorney handles someone’s finances, a healthcare power of attorney—often named in an advance healthcare directive created by the individual—can designate healthcare proxies to make medical decisions on behalf of the incapacitated person.
An advance healthcare directive often includes a living will, a document outlining someone’s wishes for end-of-life care, and any treatments they do or do not want to be performed. The healthcare power of attorney would be bound to the terms of a living will.
For any assets that do not have their own beneficiaries named, you’ll want to ensure that you have heirs named.
For any assets that do not have a beneficiary, the state will transfer them to your next of kin. This would include first your surviving spouse and children; if you have neither, your assets may go to your parents or siblings.
You don’t want the state to decide who gets your money. That’s why beneficiary designation is so critical.
Planning your estate is no picnic. There are all sorts of laws in place and costs associated with asset transfer that you don’t want your family members to be subjected to, so getting the legal help of an estate planning lawyer is vital.
At Edwards Family Law, we understand the stress of planning your estate. We aim to help you select strategies that give you the most while making the process as smooth as possible for you and your loved ones.
Reach out today to schedule a consultation.