Jillian Erika Dart, Esq., CTFA, AEP
Senior Vice President, Manager of Trust and Estate Solutions
[email protected]941.366.7222 ext. 41935
Women have unique concerns when it comes to estate planning.
On average, women live 5.7 years longer than men.* This
means there is a greater chance that you need your assets to
last for a longer period of time; there is a greater need to plan
for incapacity; and, you need to take responsibility for your own
estate plan.
An estate plan is a map that captures the way you want your
personal and financial affairs to be handled in case of your
incapacity or death.
What would happen if you were unable to make decisions or
conduct your affairs? Failing to plan may mean a court would
appoint a guardian, and the guardian might make decisions that
would be different from what you would have wanted.
Health-care directives can help others make sound decisions
about your health when you are unable to. There are also tools
that help others manage your property when you are unable to,
including a durable power of attorney and joint ownership.
A will is a legal document that directs how your property is to
be distributed when you die. You name an executor to carry out
your wishes as specified in the will.
Most wills have to be probated. The will is filed with the probate
court. The executor collects assets, pays debts and taxes
owed, and distributes any remaining property to the named
beneficiaries.
For most estates, there is little reason for avoiding probate, as
the actual time and costs involved are modest. There are several
benefits to probate - because the court supervises the process,
you have some assurance that your wishes will be abided by,
and probate offers some protection against creditors.
There are a number of reasons for avoiding probate as well. For
complex estates, probate can take up to two or more years to
complete, and wills and other documents submitted for probate
become part of the public record, which may be undesirable if
you have privacy concerns.
Probate may be avoided by owning property jointly with rights
of survivorship; by completing beneficiary designations for
property such as IRAs and retirement plans; by putting property
in an inter vivos trust; and, by making lifetime gifts.
Whether or not you have a will, some property passes
automatically to a joint owner or to a designated beneficiary.
Property that does not pass by beneficiary designation, joint
ownership, will, or trust passes according to state intestacy
laws. These laws vary from state to state and they specify how
property will pass.
A trust is an estate planning tool that can protect against
incapacity; avoid probate; minimize taxes; allow professional
management of assets; provide safeguards for minor children,
and other beneficiaries; and protect assets from future creditors.
Most importantly, trusts can provide a means to administer
property on an ongoing basis according to your wishes, even
after your death.
A trust is a legal entity where someone, known as the grantor,
arranges with another person, known as the trustee, to
hold property for the benefit of a third party, known as the
beneficiary. The grantor names the beneficiary and trustee,
and establishes the rules the trustee must follow in a document
called a trust agreement. With a trust, you can provide various
interests to different beneficiaries. For example, you might
provide income to your children for life, with the remainder
going to your grandchildren.
You can create a trust while you are alive (a living or inter
vivos trust) or at your death (a testamentary trust). A trust you
create during your life can be either revocable or irrevocable.
You retain the right to change or revoke a revocable trust. An
irrevocable trust cannot be changed or revoked.
When you dispose of your property during your lifetime or at
your death, your transfers may be subject to federal gift tax,
federal estate tax, and federal generation-skipping transfer
(GST) tax. Your transfers may also be subject to state taxes.
Making gifts during one's life is a common estate planning
strategy that can serve to avoid probate and held reduce transfer
taxes. Take advantage of the annual gift tax exclusion, which
lets you give up to $16,000 (in 2022) to as many individuals as
you want free of gift tax.
As always, we encourage you to reach out to your advisor with
any questions or concerns you may have about
estate planning.
*NCHS Data Brief, No. 427, December 2021. ©2022 Broadridge Investor Communication Solutions, Inc.
All rights reserved. This material provided by Jillian Erika Dart.
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