If you want to leave a robust financial legacy for your family, a financial plan alone is like trying to guide a boat with just one oar. It is only part of the big picture for your overall monetary health. A well-informed financial plan is worth your time for several reasons, but let’s look at how financial and estate planning can work in tandem to create the best possible future for you and your family in the years to come:
What’s included in a financial plan?
Financial planners take stock of an individual’s fiscal landscape and come up with approaches to maximize his or her overall financial well-being. People from all walks of life use the help of financial planners to make sure they’re in good shape for making big purchases, saving for their children’s education, and ensuring a comfortable retirement. This also includes developing an investment portfolio, which the financial planner monitors and manages.
But financial planning only goes so far. To have a comprehensive approach, one must also consider his or her estate and the proper will and trusts to put in place to direct assets to where one wants them to go in the long run. That’s where a trusts and estates attorney comes in.
What’s included in an estate plan?
Estate planning attorneys are lawyers who give sound advice about what will happen to a person’s assets if he or she becomes mentally incapacitated or when he or she dies. While this may not sound like the sunniest of topics, knowing that what you pass on to your family will be legally protected lets you focus on enjoying the best things in life without worrying about your loved ones’ futures. Estate planning includes defining how you want your loved ones to benefit from the financial legacy you leave behind, implementing tactics to protect your assets from creditors down the road, providing a framework so your loved ones can make medical decisions on your behalf when you can’t, developing strategies to help you reduce estate taxes, and more.
And at the end of the day, your attorney is a teacher and a mentor. He or she should be equipped to clearly explain your legal options. Even though estate planning can be highly technical, your professional bond with your attorney can and should feel like a friendly partnership since it involves taking an honest look at many personal wishes and priorities. There is no one-size-fits-all estate plan, so choose an attorney whom you trust and enjoy working with and who is responsive to your questions and needs.
While financial planning helps you get from point A to point B with some pretty big money milestones, you need an estates and trusts attorney to make sure your wishes are carried out and your money and assets stays in the right hands.
How these two efforts work together?
There are several ways these two components of your financial wellness work in harmony. Asking your financial planner and estate planning attorney to collaborate is common practice, so don’t be concerned that what you’re asking is outside their regular scope of work. Knowing who else advises you will help both parties get the information they need to do their jobs at peak effectiveness. For example, your estate planning attorney may prepare a living trust for you, but your financial planner may help you transfer certain assets into that trust.
What are you waiting for?
If you already have a financial planner and are thinking about working with a trusts and estates attorney, you’re in an excellent position. We can collaborate with your financial advisor to begin designing a comprehensive estate plan customize to your needs. This may save you time and money, as we will get up to speed with the help of your financial planner.
The right time to plan your estate is right now. The sooner you put yourself and your family in a position to rest easy knowing a solid plan is in place, the better. And now that you know your financial plan is a wonderful start, but not a complete solution, you’re ready to take the first step on the path to total financial security.