Plotkin Financial Advisors
Plotkin Financial Advisors

Estate Planning Strategies: The Basics

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Determining how you will create a legacy for your family starts with creating an estate plan. This type of financial plan is key to protecting your assets for the future. Estate plans are not limited to those that are extremely wealthy.

In fact, everyone can and should implement an estate strategy into their financial plan in order to figure out who will manage your affairs should you no longer be able to and who will become beneficiaries of your assets when you pass away.

If you would like to learn more about the basics of implementing an estate strategy, keep reading!

5 Tips for Preparing for Estate Planning

  1. Gather all necessary documents, including wills and trusts, insurance policies and retirement benefits information.
  2. Create a comprehensive estate plan that is tailored to your specific needs and objectives.
  3. Draft legal documents such as a will or trust that clearly define how assets should be distributed upon death.
  4. Take advantage of available tax exemptions to minimize gift, estate, and inheritance taxes.
  5. Appoint trustees or guardians responsible for managing your estate on behalf of beneficiaries if you become incapacitated or after your death.

3 Steps to Take When Estate Planning

  1. Determine Your Goals

With an estate strategy, you begin to outline your goals in a manner that will benefit your family later on. Eventually, you will  be leaving your assets behind, so the best thing you can do is have a plan for them. You will want to determine exactly who will be responsible for what, if your beneficiaries have or will have specific needs that you would like to take care of.

  1. Power of Attorney

A power of attorney is a legal document that helps you prepare for the future when planning what  to  do with your financial affairs. Should  you become unable to manage your assets, the power of attorney that you elect has the legal right to determine what to do with your finances and make decisions on your behalf.

Typically, power of attorneys are family members or even close friends that you grant the power to early on just in case you end up being unable to make conscious decisions. We highly recommend having a power of attorney involved with your estate plan, as it can be essential in the case of an emergency.

  1. Name Beneficiaries

We have mentioned the word “beneficiaries” in this article above, however, it is important to  know exactly what a beneficiary is and how you can name them. Should you have assets that require beneficiaries to be named, it is essential to make sure your assets are in good hands. Beneficiaries are those that inherit assets on your behalf.

As you have worked hard for your assets, you want to make sure they end up in good hands, which can be a daunting, yet very personal task that should be taken on early to prevent any delays in planning.

While we know that estate strategies can be quite complex, they are great to have in place. Once your estate strategy is established, you will feel better knowing that should any kind of emergency take place leaving you unable to make decisions regarding your assets by yourself, that your assets and belongings are in the hands of the people you chose and according to the plan you put in place.

What is a Spousal Lifetime Access Trust (SLAT)?

A spousal lifetime access trust (SLAT) is a type of revocable trust that allows the spouse who creates it to provide for their partner after death, while also protecting their own estate from taxes.

By setting up this type of trust, the creator can designate that their spouse will have access to the Trust’s full interest income or use of its principal during their lifetime.

After the surviving spouse passes away, the remainder of the trust’s assets are then passed on to beneficiaries identified by the creator or as designated in the Trust agreement.


Key Factors to Consider When Creating a Spousal Lifetime Access Trust Estate Planning Strategy

Amending beneficiary designations

When creating a spousal lifetime access trust estate planning strategy, it is important to properly amend any existing beneficiary designations. This includes life insurance policies and retirement plans, as these assets can generally pass outside of the terms of a will or trust.


Selecting the appropriate type of trust

There are various types of trusts that may be utilized in an estate plan and selecting the proper one is important. The most common type used in this context is a Qualified Terminable Interest Property (QTIP) Trust, which allows for beneficial marital transfers from the deceased spouse to the surviving spouse.

Choosing a trustee

It is important to consider who will act as trustee for the spousal lifetime access trust. The trustee must have legal authority over the trust’s assets and must have knowledge about relevant laws regarding taxation and asset management to ensure that all transactions are lawful.

Identifying and documenting assets

All property owned by either spouse should be identified and its value documented in order to make sure that everyone inheriting from the estate has accurate information about its worth. This will also help with tax considerations.


Minimizing taxes

Estate planning strategies such as revocable living trusts can be used to minimize estate taxes while allowing for flexibility in distribution of assets during life or after death.

**Assigning annual income distributions **

Designating annual distributions from income generated by any investments within the Trust can help ease financial burdens, especially if there are minor children involved in the estate plan.

**Appointing guardians for minor children **

In cases where both parents were appointed trustees but then one passes away, it is important to identify someone else who can serve as guardian for minor children so their interests are represented in any decisions made about the Trust’s assets.

If you would like to learn more about estate planning, visit our website here. Should you have any questions  regarding your current estate strategy, we would be happy to help guide you along the way. Give us a  call at (301) 907-9790



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