What You Should Ask Your Financial Planner about Your Estate Planning
Money Matters Radio – Estate Planning Q&A with Gary Goldberg
By: Martin M. Shenkman, CPA, MBA, JD
Everyone, not just the Rockefeller’s, needs an estate plan. It’s not just about taxes and wills, its about protecting you and your loved ones while you’re alive, not only when you die! Your investment adviser is key to your planning but most people think the “estate planning conversation” is only for their lawyer. Not! Talk to your financial planner and investment adviser too!
What is the most important, but neglected issue an investment adviser can help clients with concerning their estate planning?
The Big Gorilla, for many, is the title to their accounts. How an account is set up can have a world of importance to asset protection and tax planning:
Most people miss the importance of financial planning as the base of an estate plan, can you explain it?
Absolutely. No one can really do a proper estate planning without some understanding of their financial plan and budget. Many people worry about estate tax when they are burning through their assets so fast that they’ll likely run out of money before they die. The financial plan assures that you’ll have money to address under your will. A financial plan can help you determine if you can really afford to make gifts.
Are there other estate planning issues a financial planner can help with?
Lots of them! What about life insurance? Life insurance is a key to many estate plans. However, the financial plan is what often is at the core of determining how much life insurance you need, and just as importantly, how much you can afford. Your estate planner can help you create a trust to own the insurance (really important!), plan for the use of insurance to pay estate tax, and address the gift tax consequences of paying for life insurance. But the core decisions should start with a budget and financial plan all of which are in the purview of the client’s financial planner or investment manager.
Is life insurance the only insurance consideration?
No. For those working, disability insurance may be the most important insurance they can buy. As you age, long term care coverage might make sense to consider and perhaps buy.
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