Passing Assets Along Efficiently

Pass Along Assets Efficiently

Many adults have experienced inheritance. Unfortunately, receiving an inheritance isn’t always a smooth event.

There are so many things that can go wrong that extend the process of executing a will, and it can often extend the pain you feel as someone who has just experienced loss. Inheritance is an emotionally fraught concept. You’re going to feel a variety of different ways about receiving money from a relative who, in all reality, was probably very close to you.  

Whether you have experienced this or not, the idea of expediting your own estate planning process should be top of mind. Nobody wants to put their loved ones in a situation where they feel frustrated by a drawn-out inheritance process, or to extend their grief in the wake of you passing away.

Building a Strategy

Your inheritance strategy needs to include two components:

  1. A financial plan that makes your assets both abundant for passing on and accessible for your loved ones after you pass away.

  2. An estate plan that creates a seamless strategy that allows you to pass on your wealth to your loved ones, or to the causes and organizations you care about, while avoiding probate.

To put together both a financial strategy and an estate plan, you’ll need to speak with a financial planner and an estate planning attorney. Your financial planner can help you to put financial accounts in place, make sure your beneficiaries are up to date, and create a strategy that helps save both you (and your beneficiaries) on taxes. Your estate planning attorney can help you build a will, and ensure that you’re appropriately registered to avoid extending the inheritance process for your loved ones. They can also act as a point of contact for relatives after you pass away to guide them through the process.

Involving Family in Your Financial Planning

While you can technically create an estate plan without involving your loved ones, it’s not always a good idea. The best rule of thumb to follow is simple: your estate plan should contain no surprises. The executor of your will should know they’re responsible when you pass away. Everyone receiving something should be aware that they’ll be receiving an inheritance. It may even be a good idea to talk ballpark numbers with people and have them know enough about your estate plan so that they know what to expect from the process.

It can even be helpful to have family meetings with both your financial planner and your estate attorney. Your planner and attorney are professionals, and will be able to help guide conversations around inheritance, the estate planning process, and the best way to ensure your wealth is left to the people you love or used in a way that matters to you.

Avoiding Probate

To make the inheritance process easier on your loved ones after you die, you’ll want to do everything in your power to avoid probate. Your best bet is to speak with professionals who can help you navigate the process. However, if you’re starting to put together your estate plan on your own, there are a few things to consider:

  1. Write a will and a living trust.

  2. Update all of your beneficiaries.

  3. Ensure that your spouse is adequately tied to all of your assets (has their name on property agreements, etc.).

Making sure that your spouse or partner has access to your shared property, and knowing that the rest of your accounts have appropriately named beneficiaries, is an excellent first step to take to help their inheritance process go smoothly and efficiently. Additionally, your beneficiaries should have an idea of what they’ll do with their inheritance to help move the process along.

One common example is when you pass on an IRA. Inheriting an IRA is something that many people deal with in their lifetime, and understanding the combination of estate, tax, and retirement planning implications that this type of account comes with is key to ensuring that your loved ones are using the funds you give them in a way that benefits their financial life. This is another reason that having beneficiaries sit down with your financial planner or estate planning attorney can help them to create a plan of their own for after you pass away.

Seeking Help

Knowing that you’re not alone in this process is often half of the battle. If you’re overwhelmed as you get started on your estate planning journey, reach out! I’d love to chat with you about the best ways to create an efficient strategy that benefits both you, your loved ones and helps you to leave the legacy you’ve been working toward.

Lauren Estes