Don’t Leave Estate Problems for Your Family
Some individuals’ estates create difficulties for their surviving families — while the estates of many others do not. The difference is usually due to gaps in planning or the failure to plan at all.
Carefully making advance arrangements for the assets you will leave behind can mean that your family will not experience problems with your estate for reasons such as missing documents, lack of tax planning, or a funding omission that prevents a trust from working as intended.
Missing or outdated documents may result in your assets not being distributed as you intended.
A will is the foundation of an estate plan. Yet some individuals never get around to writing a will or they create one, but let it become outdated. For example, they may not change it after a marriage, a divorce, or the birth of a child. Or the will may name an executor (or personal representative) who either refuses to serve or is unable to do the job well.
The way your assets are titled is also important. For example, life insurance proceeds become part of the policy owner’s estate. Having someone else (or a trust) own the policy can keep the insurance money out of your estate.
Although their family situation changes, many individuals don’t change the beneficiary designations they’ve made for their 401(k), IRA, or other retirement assets. Simply reviewing and revising your beneficiary choices periodically can prevent potential estate problems.
If you have a substantial estate, taxes may become a costly issue. The federal estate tax exemption amount is $5 million, indexed for inflation after 2011 ($5.45 million for 2016). The highest tax rate is 40%. If you fail to plan for the possibility of estate taxes affecting you in the future, you may unnecessarily compromise your family’s inheritance.
Once you have a plan in place, it’s important to follow through on it. For example, as part of your planning, you might decide to create a living trust. But securing the advantages of the trust requires completion of the trust arrangements, including the transfer of assets to the trust. Unfortunately, individuals sometimes create a trust but, for one reason or another, do not take the final funding step.
Your financial and family situations could very well change in the future. Be sure to review your estate plan periodically to make sure it still meets your needs.
TCU Trust Services offers a comprehensive array of wealth management services tailored to meet the specific financial needs of our members. We provide a full range of personal trust services, including asset management, wealth management, estate settlement, guardian of property and estate planning assistance. Trust Services can provide protection and asset management now and after your death, which is important for you if you become incapacitated or have beneficiaries who are inexperienced or ill-equipped to handle an inheritance.
For more information contact a TCU Trust Officer
Meg Loitz, J.D. Chris Eberly Randy Tarter, CFP
(574) 245-4735 Ext 5153 (574) 245-4735 Ext 5832 (317) 268-3426 Ext 5306
807 E Jefferson Blvd.
South Bend, IN 46617
Trust Services are provided by MEMBERS Trust Company.
Click HERE to view the Winter 2017 Trust Newsletter
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Our "Knowledge to Plan Webinars" are designed to provide you with a better understanding of issues that impact your financial well-being and security. Enhanced knowledge and understanding leads to better financial decisions and helps you avoid costly mistakes. Our Webinars are presented by experienced professionals including attorneys and investment charterholders of the prestigious CFA designation. At each Webinar, you will be given the opportunity to raise questions, and to request a personal follow-up appointment or call from one of our experienced trust and investment officers. Click here for dates and times.
This information is not designed, meant, nor does it constitute the rendering of legal or tax advice. You should consult with your attorney and/or tax advisor before implementing any strategy discussed here.
Trust services provided by MEMBERS Trust Company are not federally insured, are not obligations of or guaranteed by the credit union or any affiliated entity, involve investment risks, including the possible loss of principle. MEMBERS Trust Company is a federal thrift regulated by the Office of the Comptroller or the Currency.