The 3 Core Estate Planning Concepts To Take Your Strategy To The Next Level

Your estate plan should encapsulate the legacy you wish to pass along for generations. But successfully coordinating your assets, wishes, and family isn’t only a science; it’s also an art. 

At Legacy Wealth Advisors, we work closely with the estate planning attorneys at Stewart and Bruss, P.C. to help our clients build a comprehensive plan for managing and passing on their wealth.

Today, we’re going to explore the three core concepts that are used to construct a firm foundation for each client’s estate plan: honor intent, maximize efficiency, minimize cost and taxes. 

What do these elements mean, and how can you prioritize them to build an estate plan that best represents your legacy goals?

Let’s dive in. 

Honor Your Intent

The first element is perhaps the most straightforward. It seeks to help you determine what you want your plan to accomplish—uncovering your “why’. 

Ask yourself,

• Do you want to divide your estate evenly among your heirs? 
• Are there multiple marriages and blended families to consider?
• Do you have family members whom you want to offer more help and financial support than others?
• Are charitable contributions an important aspect of your legacy?
• Who do you trust to help you carry out these wishes (executor, trustee, power of attorney, healthcare directive, etc.)?

Once you start looking, there are hundreds of questions that can help you understand exactly what you want your estate to look like. Perhaps you are comfortable leaving everything to your kids to divide evenly, or maybe you’re interested in donating some of your estate to a charity or cause that’s been instrumental in your life. 

Regardless of your route, your intent can give us a springboard to build the most efficient and effective strategy to support it.

There are several estate planning tools at your disposal like trusts, beneficiaries, designations, and more. We can best help you arrange and organize these tools when you’re clear on your “why.”

Maximize Your Estate’s Efficiency

Once you have a better idea of what you want your estate to look like, the next step is to gather the tools you need to make it happen as smoothly as possible. 

One of the most significant ways to maximize your estate’s efficiency is to avoid probate. Probate is a public proceeding that validates and distributes your assets. Avoiding probate is often desirable because it can be costly, time-consuming, and public.

Probate initiates an administrative process—it helps ensure that your assets get from point A to point B. But the process often never moves in a straight line. Since probate is court-mandated, there are several procedural formalities and red-tape to get through before your assets get where they need to go.

Instead of smoothly transferring hands, probate initiates another costly step.  

Maximizing efficiency in your estate involves using suitable vehicles to help you bypass this step, like trusts and beneficiary designations.

Take a bank account as an example. Say you wanted the funds in your account to go to your executor (your child) when you pass to cover immediate cash needs like funeral expenses. 

If you made your child a joint owner on the account, when you pass away, they automatically can access the account. On the other hand, if you didn’t have that designation, the account would go through probate before your child could access the funds.

Knowing your intent is a critical first step to building a seamless process.

Minimize Your Cost and Taxes

The final core estate planning consideration is all about minimizing costs and taxes. 

Estate planning can be expensive, but it doesn’t have to be out of reach. When you know what you want to achieve and the options available to you, your team of estate planning professionals can help you secure the most cost-effective options for your needs. 

Your team will help you answer the following questions:

• What vehicles do you need to help you achieve your goals? Are there other creative strategies you can employ?
• What are tax-efficient ways to pass down wealth? (giving more while alive, establishing the right trust, remaining cognizant of how different assets are taxed).
• What assets work best in certain vehicles? 
• How can you adequately fund a trust? 
• Does it make sense to make your executor a joint owner on some accounts?
• Are you leveraging your beneficiary designations? Naming the most qualified beneficiary can be a powerful and often underestimated estate planning tool.

Knowing what you want to accomplish helps us understand the right questions to ask and develop a plan that works for you. 

How Can You Prioritize Among The Three?

Everything in life involves balance, and your estate plan is no different. 

The way these three core concepts relate to each other depends on their importance. Start by understanding your goals and values. From there, you’ll be able to establish what’s most important to you.

Will your intent always be your first priority? If so, other areas like costs may be a bit higher, especially if you have complex needs. 

Each element can counterbalance the other. Sometimes intent may make the other two areas less efficient and vice versa. If keeping costs low is your highest priority, you may need to be willing to make compromises in other areas.  

But you don’t have to go through the process alone; the right estate planning attorney will help you work through each of those scenarios, and in conjunction with a financial planner like Legacy Wealth Advisors, you can create a well-coordinated plan to execute your legacy. 

Are you ready to take your legacy planning to the next level? Get started with us today.

Advisory services are offered through Legacy Wealth Advisors, LLC dba Legacy Wealth Advisors, an Investment Advisor in the State of Michigan. The information contained herein should in no way be construed or interpreted as a solicitation to sell or offer to sell advisory services to any residents of any State other than the State of Michigan or where otherwise legally permitted.

All content is for information purposes only. It is not intended to provide any tax or legal advice or provide the basis for any financial decisions. Nor is it intended to be a projection of current or future performance or indication of future results. Moreover, this material has been derived from sources believed to be reliable but is not guaranteed as to accuracy and completeness and does not purport to be a complete analysis of the materials discussed. Legacy Wealth Advisors does not offer tax planning or legal services but may provide references to tax services or legal providers. Legacy Wealth Advisors may also work with your attorney or independent tax or legal counsel. Please consult a qualified professional for assistance with these matters.