What Are the Important Estate Planning Factors?

They say, ‘Expect the best. Prepare for the worst.’ Though we all must grow a positive outlook, we should take steps to ensure that life’s contingencies do not catch us and our loved ones off guard. To ensure smooth sailing during turbulent times, you must seriously consider creating an estate plan with your estate planning attorney in Santa Rosa. An estate plan helps eliminate family messes. It clearly defines the process the executor must follow to manage and dispose of the person’s estate during their life and after their death. An estate plan can be delivered through various devices including a will, an advanced directive, or a trust. To ensure everything is accounted for, you need to come up with a well-rounded plan that covers all the bases. When creating your estate plan, remember to consider the following factors.

Your Beneficiaries’ Needs

When creating an estate plan, you will designate beneficiaries for your retirement accounts, insurance policies, super account, and other investment accounts. You will be in the driver’s seat when deciding how to divide your estate among friends and family members. It is important that you consider the needs and spending habits of your beneficiaries. To secure the financial future of your beneficiaries, earmark funds to cover tuition fees and other major expenses. When deciding the assets you want to leave for your beneficiaries, consider their age, financial status, and gift or estate tax.

Your Financial Situation

An accurate evaluation of the person’s financial situation is the foundation of a well-rounded estate plan. Collect documents related to your investments and every asset that you own. When calculating the total value of your assets and anticipated cash flow with your estate planning attorney in Santa Rosa, go through these documents. To calculate your net worth, deduct your total liabilities from assets. When calculating the cash flow that you need to generate in the future, consider contingencies (unexpected expenses), the rising cost of living, and any other significant event that may impact your finances (such as retirement). An accurate analysis of your financial situation will help your law firm in Santa Rosa come up with a customized plan that ticks all the right boxes for you.

Taxes and Their Effect on Your Estate

From gift and estate tax to property tax, there are different taxes that will impact the current and future value of your estate. You need to work with your law firm in Santa Rosa to develop a deep understanding of how these taxes will impact your estate. While some assets can be sold without any tax consequences, others do not receive this preferential treatment. To steer clear of taxation complexities, you need to create a well-structured tax plan with your estate planning attorney in Santa Rosa.

Estate planning is not an amateur’s cup of tea. An expert estate planning attorney in Santa Rosa conducts various complex calculations. When taking decisions, they consider both present and future market conditions. At Johnston & Associates Law, we take the guesswork out of estate planning. No matter how complex your requirements, our experienced attorneys got you covered. To talk to an attorney in Santa Rosa and Sonoma County, call us at 707-545-6542 to discuss your requirements.