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As an Estate Planning attorney, I often come across people who know Estate Planning is an important thing to have done but are uncertain about what Estate Planning really is or how to get started.
Estate Planning is simply the process of preparing for the transfer of your assets and property after you pass away. I prepare Estate Plans for clients by analyzing their assets, learning about their family situation and discussing their Estate Planning goals in a special meeting with them we call the “Ritchie Legacy Planning Session”.
At the end of a Ritchie Legacy Planning Session, I can recommend to my clients a combination of Wills; Trusts; and/or beneficiary designations to make sure you have proper Estate Planning in place. Proper Estate Planning can help your estate avoid probate (the legal court process of settling your estate), minimize taxes, and ensure that your assets go to the people you care about.
Many people believe that Estate Planning is only for the wealthy, but this is a common misconception. Estate Planning is for anyone who wants to protect their assets and ensure that their wishes are followed after they're gone. Whether you have a few thousand dollars in savings or millions in investments, Estate Planning is an essential part of your financial planning. Estate Planning is not just about wealth preservation for the next generation, but also ensuring that your wishes are carried out and that your loved ones are taken care of.
Getting Started with Your Estate Plan
So, how do you get started with Estate Planning? Here are some steps you can take:
1. Assess your assets and liabilities.
Make a list of all your assets (property, investments, life insurance, etc.) and liabilities (debts, mortgages, etc.). This will give you an idea of what you have and what you owe, which is essential for Estate Planning. Before I meet with clients for their Ritchie Legacy Planning Session, we have them fill out an Estate Planning questionnaire. This questionnaire asks clients to list their assets and identify which accounts may have beneficiary designations. We ask for this information so we can properly analyze our client’s assets from an Estate Planning standpoint during our first meeting with them. We review their assets with them on a diagram we have developed over the years we call our “Probate Asset Analysis Diagram”. With this diagram, we can explain how Estate Planning works and how our clients’ assets would be transferred upon their passing.
2. Decide who you want to inherit your assets.
Think about who you want to receive your assets when you pass away and make a list of these individuals. Sometimes this is a very easy decision for clients to make – especially if they are married and have children. Many times though, because of blended family situations, strained family dynamics, or other reasons, it may take some thought to determine who you want to receive your assets. During our Ritchie Legacy Planning Session, we help clients think through this decision-making process. With the experience of helping 500+ families with their Estate Plans, we can advise on Estate Planning options for whatever situation our clients have
3. Will-Based Estate Plan vs. Trust-Based Estate Plan.
We like to think of Estate Plans in two broad categories. Some people need a “Will – Based” Estate where a Will is their main Estate Planning document. Other people need a “Trust-Based” Estate Plan where a Trust is their main Estate Planning document.
A Will is a legal document that states who you want to inherit your “Probate Assets”. It is a simpler Estate Planning document that has some limitations – but for many people, it is exactly the type of plan that they need.
A Trust is a more complicated Estate Planning document that offers a lot more flexibility than Wills. If you have a larger estate and/or a more complicated family situation, Trusts can be useful Estate Planning tools because they can help avoid probate, reduce taxes, and provide greater control over assets that Wills simply cannot do.
CLICK HERE to learn more about the difference between Wills and Trusts. By the time we are done with our Ritchie Legacy Planning Session, we can determine if a client needs a “Will-Based” Plan or a “Trust-Based” Estate Plan.
4. Review and Update Your Estate Plan Regularly.
Over time your assets will change and your family situation may change. Children grow into adults. You may receive an inheritance. A loved one may pass away. Once you have your Estate Plan done it is important to review it regularly and have it updated if necessary to reflect your current financial situation and personal wishes. At the Ritchie Law Office, Ltd., we have a maintenance program for our Estate Planning Clients called the “RLO CARE Program”. We offer services to help make sure your Estate Plan is maintained and will work when it is needed most.
Next Steps
Estate Planning can seem overwhelming, but it's essential to take the time to prepare for the future. With the right plan in place, you can ensure that your assets are protected, your loved ones are taken care of, and your wishes are followed after you're gone.
At the Ritchie Law Office, Ltd. making sure you have a proper Estate Plan starts with scheduling your very own Ritchie Legacy Planning Session.
CLICK HERE to learn how to schedule your own Ritchie Legacy Planning Session and make sure you have a proper Estate Plan.
This article is a service of Attorney Chad A. Ritchie and the Ritchie Law Office, Ltd.
Click Here or call (309) 662-7000 to learn more about Ritchie Law Office, Ltd. and our Estate Planning process, which starts with an initial consultation called our “Ritchie Legacy Planning Session”.
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