Estate planning is something that many of us put off dealing with. But having a plan in place after you have gone is one of the most important things you can do for your loved ones, especially if you are one of America’s 73 million baby boomers. Without a plan in place for your estate, settling your affairs after you die could be an expensive and lengthy process for your loved ones. It is never too early to start estate and inheritance planning, but it can often be too late. Estate planning helps you to reduce tax on what you leave behind, stretch your IRA over generations, and ensure your loved ones get everything you have worked so hard for (without any ugly legal battles).
Importance Of Estate Planning
If you have any kind of property, such as a car, home, 401k, bank account, or pension, then you have an estate that will need to go somewhere after you die. But it’s about more than just who will inherit your possessions. It also includes important decisions about who will look after your children if you die, and who will make financial decisions or health care decisions on your behalf if you are no longer able to make them yourself.
Funeral Planning
For many people, retirement planning is simply about how to make their money last until the end of their life. But what is often overlooked is working out how much money is required to cover expenses that will arise after they are gone, expenses like estate planning, funeral planning, etc. While funeral insurance is not a priority for many Americans, it is a life insurance policy that is designed to cover the costs of your funeral, burial, and any other final expenses that may arise in the future. But how much does it cost for funeral insurance? Can most Americans afford it? Well, based on our research the average cost of funeral insurance is around $50 a month, but your premium will largely depend on your health, age, gender, and the total amount of cover you purchase.
Protect Your Beneficiaries With An Estate Plan
If you have assets, then you need to decide what happens to them after you have gone. Otherwise, a court will decide in your place, which can take years, be expensive, and can lead to family rifts. This is particularly important if you have children from more than one family or more than one spouse. It also allows you to protect your loved ones from the IRS. An essential part of estate and inheritance planning is transferring assets to your loved ones that create the smallest possible tax burden for them.
If you want to ensure your loved ones and your assets are protected when you are no longer here, you need an estate plan. Putting off estate planning could leave your heirs with a huge tax burden, and the courts could be left to not only decide how your assets are divided up, but who will be raising your children.