Three Essential Estate Planning Strategies

By Teresa Conley | June 30, 2016

We understand -- few people enjoy estate planning. While it may not be top on anyone's list of fun activities, setting out your estate planning strategies before the inevitable takes place can increase your peace of mind, and help your spouse and family through the difficult transition when the time comes. 

Teresa Conley is a CFP, Certified Financial Planner and a 401(k) Financial Advisor with Premier Financial Group in Eureka Humboldt CountyThink of estate planning just as you do retirement planning: Necessary, if not extremely enjoyable. These three essential estate planning strategies will help you -- as well as your spouse and family -- prepare.

1. Does Your Spouse Know Your Wealth Management Advisor?

If you're like many people, you've been working with the same wealth advisor for years. But, also like many people, just one of you may have been working with that wealth advisor to take care of most of the strategic financial planning. Perhaps your spouse has sat down with your advisor a few times over the years, but she or he may not have the familiar relationship that you do. 

Consider that if you suddenly passed away, your spouse would be working closely with a person they don't know that well during an extremely difficult time. It just makes sense for your spouse to get to know your wealth advisor well before the need arises. 

After all, your private wealth advisor is likely involved with most of your financial dealings, from your investment portfolio to your retirement accounts, estate planning to retirement planning, so your spouse should really get to know them. Make an appointment to sit down with your advisor for a complete financial review and bring your spouse along, so they can get to know -- and feel comfortable working with -- your advisor.

2. Financial Planning Tools: Are Your Wills and Beneficiary Designations Current?

Don't assume that just because you have a will, your assets will go where you want them to after you pass away. In fact, many assets may not be covered by your will. Take the time to ensure that important accounts are updated, with the correct beneficiaries listed. 

You'll want to check your:

  • Life insurance
  • Annuities
  • Retirement accounts such as IRAs and 401ks
  • Taxable investment accounts, such as jointly held bank accounts

Speaking of taxable investment accounts, most allow the holder to designate who the account will pass to upon their death. This is known as selecting a transfer on death or TOD designation. The Internal Revenue Service treats this type of account differently; the TOD designation generally keeps the account out of probate, as well.

3. Does Your Spouse Know How to Access Your Investment Planning Accounts?

Your spouse will likely need immediate access to funds in order to cover your final costs, as well as end-of-life costs such as medical bills -- and that's on top of all of the normal, day-to-day living expenses. Will she or he be able to access your financial accounts?

The last thing your spouse needs to worry about during this difficult time is searching for passwords, documents and bank account numbers, so make it easy and take care of it now. 

Sit down with your spouse and review all of your accounts so they know how to withdraw what they need, when they need it. You'll want to create a few lists, including:

  • All of your offline and online accounts and memberships
  • All of your passwords for online accounts and memberships
  • Your estate planning and financial planning documents and where you keep them
  • Names and contact information for all of the wealth advisors, CPAs, and attorneys that you work with to manage your financial affairs

While estate planning strategies may not be the most uplifting topic, the truth is that someday, your spouse may need this information. It's better to take steps now to prepare, and ease the transition through a difficult time in the future.

Posted in Estate Planning