What is an Estate Plan?
An estate plan is exactly what it says it is; a plan for your estate. Estate planning allows you to specify exactly where each of your assets goes upon your death, whether it be to family, friends, a trust, etc. It will ensure your hard earned assets do not land in the hands of the wrong person.
Why do I need an Estate Plan?
Through estate planning, you will ensure your assets will be handled exactly how you want. By involving the help of a professional, you will also ensure the transfers of your assets will occur with minimum tax consequences, and that your estate has enough liquidity to meet its obligations to your beneficiaries.
Estate planning usually involves the purchase of life insurance. Life insurance pays out a death benefit to the beneficiary upon the death of the insured, hopefully leaving the beneficiary with the funds to cover the cost of maintaining the estate. This should give the beneficiary the time to sell the estate without having to lose any value of the assets, or to purchase the assets themselves. Other detailed, technical aspects may also be involved in estate planning, depending on the individual client's wants and needs.