Estate Planning is a way in which someone gets their finances and personal affairs in order before they die to make sure they leave things as easy and clear as possible for their personal representative (executor or administrator) to sort out after their death.
This can often include requiring help with probate
Protect Your Assets and Loved Ones. Receive Peace of Mind with an Estate Plan.
– Estate planning is a form of inheritance planning, the process of preparing for the wealth management and disposal of a person’s assets after their death.
– It involves creating legal documents such as wills, trusts, powers of attorney, and health care directives to ensure that your wishes are carried out in accordance with your desires.
– A will is a document that outlines how you want your property distributed upon death.
– Trusts can be used to manage assets during life or after death, provide tax benefits, protect assets from creditors or lawsuits, and provide for family members who may not have access to other resources.
– Powers of attorney allow someone else to make decisions on behalf of an individual if they become incapacitated due to illness or injury.
– Health care directives specify what medical treatments should be provided if an individual cannot make their own decisions about their health care.
– An estate plan should also include provisions for guardianship in case minor children are left without parents or other responsible adults.
– Estate plans can provide peace of mind and financial security for loved ones after a passing.
In the UK, estate planning typically involves creating a will and setting up trusts.
A will is a legal document that outlines how you want your property distributed upon death.
Trusts can be used to manage assets during life or after death, provide tax benefits, protect assets from creditors or lawsuits, and provide for family members who may not have access to other resources.
Other options include setting up Lasting Powers of Attorney (LPAs). This legal document allows someone else to make decisions on behalf of an individual if they become incapacitated due to illness or injury.
It is important to consider the following when considering inheritance planning for your family’s future:
1. Your current financial situation: It is important to understand your current financial situation and how estate planning will affect it. This includes understanding your assets, liabilities, income sources, and any other relevant information that could impact your decisions when creating an estate plan.
2. Your goals for the future: Estate planning should be tailored to meet your needs and goals. Consider what kind of legacy you want to leave behind, who will benefit from your estate plan, and how much control you want over its distribution after death or incapacity.
3. Tax implications: Depending on where you live, different tax implications may be associated with certain types of estate plans or distributions of assets upon death or incapacity. Make sure to research these potential taxes before deciding which type of plan is best for you and your family’s needs.
4. Professional advice: Estate planning can be a complex process that requires professional guidance to ensure all legal requirements are met while also meeting individual objectives and those of beneficiaries named in the document(s). Consulting with an experienced solicitor or financial advisor can help clarify available options to make informed decisions regarding one’s estate plan design.
The financial planning aspects (sometimes referred to as Inheritance Tax (IHT) planning) when creating an estate plan may include:
The personal aspects when creating an estate plan are likely to include:
Estate planning will involve the solicitors sitting down and going through your affairs, personal and financial, to get an accurate and complete picture of your life, wealth and wishes. This helps them advise options that work best for you and your situation. Each situation is unique, so each person will need specific advice and an individualised solution to their particular circumstances.
It will include reviewing any existing wills that you may have made and making sure valid and suitable wills are in place.
It may look at life planning or lifetime gifting, either outright or into a trust. This can be important to reduce the value of the estate left on death and make efficient use of lifetime exemptions and reliefs to ensure proper planning for minimising Inheritance Tax exposure.
It will likely include advice on making plans for later life needs including Lasting Powers of Attorney so that, should you no longer be able to make decisions for yourself, someone you trust and choose can make these for you in your best interests.
It may involve a Financial Advisor where you need to explore taking out investments or re-ordering those assets you already own in a more tax-efficient way.
It will only ever involve taking steps that are legal. Particular attention must be given to not falling into the trap of deliberate deprivation rules, particularly where someone may be already ill or elderly. In such a situation someone may be tempted to give away assets to reduce the possible need to fund future care costs that may arise, but a solicitor will advise on what may or may not be possible in this situation.
Estate planning can also take place after death in certain situations and again legal advice should be taken as soon as possible after death if this is what is sought.
Executing an estate plan with a Solicitor typically involves a series of steps. First, the attorney will meet with you to discuss your goals and objectives for the estate plan. During this meeting, they will review any existing documents or assets that may be relevant to the planning process. The solicitor will then advise on how best to structure your estate plan to achieve those goals and objectives while also considering any applicable laws or regulations.
Once all decisions have been made regarding the design of the estate plan, it is time for drafting and execution. Based on what was discussed during initial meetings, the solicitor will draft all necessary documents, such as wills, trusts, powers of attorney, etc. Once these documents are drafted, they must be signed by both parties (the grantor/testator and witnesses) for them to become legally binding upon death or incapacity. After the signing has taken place, copies should be provided to each party involved so that everyone is aware of their rights under the document(s).
Keeping an estate plan up to date is important in order to ensure that it accurately reflects your wishes and intentions. It is recommended that you review your estate plan at least once every three years or whenever there are major life changes such as marriage, divorce, the birth of a child, etc.
During this review process, any necessary updates should be made to the documents for them to remain valid and effective. This could include updating beneficiary designations on accounts or changing executors/trustees if needed. Additionally, new documents may need to be drafted depending on what has changed since the last time the estate plan was reviewed.
Once all updates have been made and any new documents have been drafted, they must then be signed by both parties (the grantor/testator and witnesses) for them to become legally binding upon death or incapacity.
To ensure that your wishes are followed in an estate plan, it is important to be as specific and detailed as possible when drafting the documents. This includes clearly stating who will receive what assets, how those assets should be distributed, and any other instructions you may have for the executor/trustee of your estate.
Additionally, it is important to name a trusted individual or institution (such as a bank) to serve as executor/trustee of your estate so that they can carry out your wishes according to the terms outlined in the documents.
Finally, ensure all necessary signatures are obtained on each document before filing them with the appropriate court or agency.
If you need help with inheritance planning, The NBS can help advise on comprehensive estate planning services, including wills, trusts, tax planning, asset protection strategies, etc. This ensures that all user needs are met in one place.
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