The Estate Planning Crisis

Bruce Larsen is Presidential Wealth Management’s Director of Enterprise Solutions as well as a senior financial advisor. Bruce is also the author of A Concise Guide to Taxes in Retirement and the creator and developer of Legacy Guide.

Current trends in estate planning point to a decline in having a plan in place when an individual passes. Learn how to prevent the state taking control of your estate and ensure you are in control of the process.
Estate Plannig Crisis

Over the years the focus on estate planning has diminished for most people. This is likely due to the estate exclusion being dramatically increased in recent years. Because most people do now not have to worry about paying estate taxes, they feel estate planning is not needed. This is a mistaken assumption.

The primary purpose of estate planning remains what it always has been—not to leave a mess for your heirs to sort out. While a component of the ‘mess’ for most of us no longer involves liquidating large portions of an estate to satisfy Uncle Sam, planning is still necessary for everyone.

If you pass with no estate plan in place, state law dictates how your assets are distributed. This can lead to some very poor unintended consequences. While most of your estate will be directed towards your direct decedents, some states also have provisions that part of your estate be distributed to other relatives.

A proper plan will often include creation of a trust and will, and designations for trustee and executor for the estate. If this is not done, your estate could be administered through probate. In some states, that can cause very substantial delays and expense, not to mention that someone that you do not know may settle your estate, who will be paid out of estate assets.

There are numerous other tasks that must be completed to settle an estate, such as filing notice in a local paper, preparing an inventory and a final accounting, determining disposition of last remains, and paying for the funeral—often with estate assets unaccusable. I could go on for several pages, but the bottom line is, please, think of the people you care about that are going to have to clean up this mess.

At Presidential Wealth Management we use a web-based system that takes much of the mystery out of the estate planning process. Ultimately, an estate plan is primarily a set of instructions outlining how your assets will be treated, ideally in the most efficient way. Our system allows you to enter all the people who are important to you, enter your assets, and then indicate who should receive each asset, or the percentage of an estate that each person will receive. You can also upload estate planning documents you have prepared in the past, if you have any. Based on what you have, and the distribution plan you have created, your estate attorney can then advise you what remains to be done to have an estate that is easy to settle—if you don’t have an estate attorney we can provide you with referrals. 

The system we use—LegacyGuide— has several added features that you can use if you would like, such as a family tree builder and an easy way to write your life story that you can pass down to your decedents.

The passing of a loved one is stressful enough without the added burden of sorting out a messy estate. If you have been involved in settling a difficult estate, then you know what I’m talking about—make it easy for your family. Let your advisor know if you are interested in starting the process.

If you are interested in seeing how we can help you with estate and legacy planning, fill out the form below to schedule a demonstration of LegacyGuide. 

Annual Estate Exclusions

YearExclusionTop Tax Rate
1998$625,00055%
1999$650,00055%
2000$675,00055%
2001$675,00055%
2002$1,000,00050%
2003$1,000,00049%
2004$1,500,00048%
2005$1,500,00047%
2006$2,000,00046%
2007$2,000,00045%
2008$2,000,00045%
2009$3,500,00045%
2010$5,000,00035% or 0
2011$5,000,00035%
2012$5,120,00035%
2013$5,250,00040%
2014$5,340,00040%
2015$5,430,00040%
2016$5,450,00040%
2017$5,490,00040%
2018$11,180,00040%

If you have a question or comment about the information in this article or would like to schedule an appointment to speak with one of our financial advisors, please fill out the form and we will be back touch.

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