Protecting your legacy

Sat, 01 Feb 2025 05:49:00 -0700

Protecting your legacy

Many parents hope to leave a parting gift for their children after they’ve gone. But how can you be sure they will use their inheritance the way you intended?

Protecting children from mismanaging their inheritance is one of the top three pressing concerns of people seeking estate planning, according to a recent survey.

These simple strategies from can help address your concerns and ensure that the funds you leave behind will be used wisely.

Q: What are the primary reasons someone would want to delay or restructure an inheritance?

A: Some people are concerned that their heirs will not make good financial decisions if the inheritance is collected all at once. Others want the gratification of knowing they are contributing to a certain event in their children’s or grandchildren’s lives (for example, putting money toward a college education or milestone birthday). And in many cases, it is because they have a child or grandchild with special needs.

Q: What solutions do you typically recommend?

A: There is never a set solution. Each client's situation is different. But I would discuss establishing trusts and looping in an estate-planning attorney to make sure the assets are dispersed the way the grantor intends them to be.

Q: Suppose I want to specify exactly how my inheritance should be used or distributed, or protect it from ending up in the wrong hands. How would I do that?

A: There are a few ways. Some cases require an attorney or financial advisor. Depending on the value and complexity of the estate, a lot of times a trust will be needed. Sometimes solutions can come from the financial product alone, like an annuity. This is possible because the financial product is beneficiary friendly, meaning the client can assign how and to whom the assets will pass upon their death. The options are so detailed that even if the grantor outlives any of the beneficiaries the grantor themselves can choose how the deceased beneficiary’s share will be decided—whether it stays in the passed beneficiary’s bloodline, or gets shared among the still-living original beneficiaries.

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Estate planning 101

Sun, 01 Dec 2024 05:41:00 -0700

Estate planning 101

Having a smart estate plan is essential for everyone—regardless of assets, age, or income. Here's what you need to know to build yours.

You might think estate planning is something you can put off until your later years, or that it's just for the super wealthy, or both. But setting up a clear path for what happens to your property and your family after your passing can make life for your heirs much easier in a time of stress and grief. That's where an estate plan comes in.

"It's your chance to really take control of how your property is going to pass upon your death," says Kelley Bentley, a Houston-area attorney with Roberts Markel Weinberg Butler Hailey PC.

Here's what you need as part of a solid estate plan, no matter your assets, age, or income.

Will

This basic legal document will set up who will get what—without having the state step in and make those decisions, which is often a headache for your heirs and can cost them more money in the long run.

A will is especially important if you have minor children and are a single parent, says Bentley. If you don't do any planning for your children, they have to go into a guardianship, which can be traumatic, while the legal system sorts out who your children will be living with in the future. Plus, a judge may decide on a guardian you'd never have chosen yourself. By having a will in place that states who your children's guardians will be in case something happens to you, you can ensure that they will be raised by whomever you see fit.

Trust

A trust can do a couple of important things. First, it means your estate will not go through probate, a process that can delay assets being passed on to your heirs. This is especially helpful if you hold properties in more than one state, says Bentley, as your estate would be subject to separate probates in each state.

A trust can also be set up for special needs or minor children. It will determine how the assets they inherit will be used to support them, who will make those decisions, and when the children can take over that fund themselves, if ever.

Powers of Attorney

If something happens to you and you can't make decisions for yourself, who will be in charge? Who will make sure that your bills are paid and that medical decisions are made with your best interests and wishes in mind? Bentley says that your estate should determine who holds your medical and financial powers of attorney. Keep in mind that those roles may be held by two different people.

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Protecting your legacy