Our approach to estate planning is about you. We don’t try to fit your project into a mold; rather, we design the plan around you and your unique financial and family circumstances. Any estate plan must be revisited regularly. Consider the flux of events: changes in financial situation, place of residence, family, health, and of course, the ever changing tax law.
What is Estate Planning? It is the process of arranging for the orderly management and disposition of your financial assets and personal affairs in the event of death or in the event of your mental or physical incapacity during life. At TLD, we coordinate the many facets of this process into a comprehensive, thorough plan.
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Who needs estate planning? You do. Estate planning is not just for the “wealthy”. Anyone with any assets at all (remember life insurance too) who cares about what becomes of those assets upon death or disability is in need of estate planning. In addition, if you have minor children, you want to make sure guardianship issues have been addressed in your estate plan.
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I have a Will - Isn’t that all I need? When was the last time your Will was reviewed? Think of the changes that have happened in your life and your family since then. Also, your Will is only one piece of the estate planning process. Even the most meticulously crafted Will is not going to be effective if it is not coordinated with the other pieces of your estate plan such as asset titling (joint tenancy, tenants in common, payable on death – these title designations have a real consequence in your plan), beneficiary designations on your retirement accounts and annuities, and beneficiary designations on your life insurance policies.
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I’m not sure if my parents have an estate plan – this concerns me. It should. You may very well be involved in assisting your parents with these issues eventually, and as difficult as it may be to broach the issue with them now, it is in both their and your best interest to make sure they have planning in place. Additionally, it’s no fun to see your own would-be inheritance being re-routed to the United States treasury for estate tax which could have been avoided with some planning. We would be happy to meet with your parents and discuss our services in this area. \
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What is a Trust? A trust is a legal entity (created by a document generally, called a “Trust Agreement”). The Trust Agreement has three primary parties: 1) Grantor – this party creates the trust and generally names the Trustee and the Beneficiary(ies) and contributes assets into the trust, 2) Trustee – this party has the fiduciary responsibility to manage the assets of the trust and to make distributions to the beneficiaries, etc. according to the terms of the trust, 3) Beneficiary – this party enjoys the income and/or assets of the trust based upon the conditions set out in the Trust Agreement.
Example: Grandparent (grantor) creates a trust to pay college expenses for grandchild (beneficiary), and names the parent of the grandchild as Trustee.
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What is the purpose of a trust? A trust is generally used when a grantor wants to make a gift to someone (or to a charity) but doesn’t want to make an outright transfer of the assets to that person (or to the charity). This could be for a number of reasons. Trusts are very flexible. The grantor can create almost any provisions they want in the trust agreement. For example, the agreement could provide for the beneficiary to receive the income from the trust’s assets each year but is not to receive the actual trust assets until a certain age. The trust bifurcates the legal ownership of the assets from the beneficial ownership of the assets. This unique feature of trusts makes them invaluable tools in the estate planning arsenal. They are used for such purposes as: Management of assets, transfers to children (especially minor children) or grandchildren, special needs children, providing for a surviving spouse, protection from creditors, charitable transfers, and estate tax savings.
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Common Estate Planning Objectives
- Protect my assets from going into court conservatorship if I am incapacitated
- Transfer my assets at death according to my wishes
- Provide for guardianship of my children in the event of my death
- Provide for a trust for my children or grandchildren
- Make charitable gifts
- Accomplish objectives at the least possible cost including estate taxes and income taxes
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What is involved in engaging TLD to perform Estate Planning for me? First of all, we do not have a “cookie cutter” process because each client’s estate planning needs will vary widely. We customize the engagement to meet your individual needs. To give you a feel for the process, however, here is how many of our projects proceed:
- We listen to you. We will begin by meeting with you to determine your objectives and needs.
- Once the scope of the engagement has been determined, we will proceed with obtaining from you any additional information and documentation we will need to perform our analysis.
- Based upon our analysis, we will determine recommendations and/or any additional items requiring further discussion.
- Typically, we would then meet with you to review our analysis, our initial recommendations, and the effect of those recommendations on your estate plan. Generally this meeting would include discussion of current and future estate tax law as it affects you, as well as client education regarding the mechanics of the estate tax, such as the marital deduction, beneficiary designations, title issues (joint tenancy versus tenants in common), estate tax rates, exemption amounts, etc. We will work through our discussion items and determine any follow-up items for you and us.
- Follow up on any open issues and act on our recommendations. Generally this includes TLD preparing correspondence to your estate attorney (we can refer you to a qualified attorney if you do not already have one) to draft any documents which we recommended. Also, we will continue to work with you until all elements of the plan are in place. This is CRITICAL – the best estate plan cannot work if it is not executed.