Even if your children are adults and living on their own, you still want to look out for them and try to make their lives as simple as possible. Moreover, the years after your kids move out are a great opportunity to handle your estate plan, whether you have one from when they were toddlers or never got around to drafting one. If you need an attorney in Tacoma to take care of your estate plan, click here.
Here are four points to consider if you are making or reviewing your estate plan:
Power of attorney:
For this, you formally authorise someone you trust to act on your behalf by signing a power of attorney. However, your power of attorney cannot be signed if you are not mentally competent. With the help of your POA, you can designate an “agent” to act on your behalf. If you become disabled and unable to make decisions for yourself, an agent can take over and make important financial, medical, or other life decisions.
Trusts and inheritances for your children:
In some circumstances, it may make sense to create a trust to manage the distribution of assets to the surviving spouse and children.
There are numerous ways to leave your children an inheritance. Leaving the inheritance in a trust is a wise move. The trust can be set up with certain clauses, such as distributing the inheritance in instalments over time. Moreover, a trust can also eliminate the probate problem, enabling the inheritance to pass smoothly.
Tax-Deferred Variable Annuities or Life Insurance:
To make sure your assets are allocated to the right people after your death, you may wish to revise your life insurance policy and review your beneficiary designations.
With life insurance, your beneficiaries receive the payouts tax-free and without having to worry about stock market volatility or go through the probate process.
Fixed or variable annuities contain a life insurance component and allow you to invest in the stock market through mutual funds or fixed-income investments. However, these policies frequently have hidden costs and fees, so it’s crucial to examine them thoroughly.
It’s crucial to speak with a lawyer or tax counsellor to establish which options are best as they may not be suited for everyone. Empty nesters should remember that now is the ideal time to examine and revise their estate plans. Reviewing your estate planning options should be prompted by any significant family milestone because changes are nearly always necessary.