By Paul S. McNulty, CFP®
We all know that having a will is of the utmost importance. But if creating one for yourself is still on your to-do list, it’s time to stop procrastinating! Sure, it’s not the most exciting task, but this crucial document is worth the effort. By providing a clear map for carrying out your wishes, you’re showing love and care for your loved ones.
Let’s go through 3 reasons why it’s so important to make your plan official.
1. To Determine Who Gets What
Depending on the season of life you are in and your financial situation, deciding who gets what and who is given certain responsibilities could require a lot of thought. However, if you don’t make a will, the government will choose what to do with what you leave behind, and this varies from state to state. Needless to say, you want to make these decisions, not them! Let’s separate this into categories so it’s easier to process.
Custody Of Children
Make sure you have talked with the people you want to be the caregivers of your children and have that written down so it can be legally enforced. If you are leaving money to anyone underage, you need to also determine who is going to handle the money you leave to them until they can make those decisions themselves.
Who Inherits Which Assets
First, think of all your assets. This could include real estate, money in retirement accounts, stocks, vehicles, jewelry, higher-ticket items in your house, or family heirlooms. Whatever you have, be detailed about how you want these assets divided.
If you want to make sure some of your wealth is left to causes you care about, that needs to be detailed in your will. Making arrangements now for your philanthropic initiatives can oftentimes provide those charities with even more resources and save you money on taxes at the same time. This leads us to another reason why it’s important to create a will now!
2. To Protect Your Wealth From Taxes
You’ve worked too hard to let your wealth get dissolved by taxes. By planning now, you can ensure you take advantage of as many tax-efficient strategies for your estate as possible.
Here are a couple of options for you to discuss with a trusted financial planner that could provide more savings or tax benefits:
- Discuss which is the best option for your situation, a living trust or a will? Depending on the size of your estate and assets, there could be significant tax advantages on the federal and state level for creating a living trust instead of a will.
- Set up a donor-advised fund for charities you want to support. Creating and funding a donor-advised fund gives you a tax deduction immediately and allows that money to grow tax-free for the charity of your choice. (1) You can choose to either have this fund continue after you die or to have the funds distributed upon your passing.
3. To Prevent Loved Ones From Making The Hard Decisions
Maybe you have already experienced this yourself, but when someone passes away, the last thing you want to deal with is ambiguity, probate, and having to make decisions that person should have made themselves.
You have done the hard work of providing for your family and leaving them in a place of financial stability. Now it’s time to bless them with not only money, assets, or items, but also a smooth transition.
Do You Need Help Creating A Will?
If you still don’t have a will, now is the time to verify everyone is on the same page and make it official. Those close to you will be thankful you made it a priority.
And remember that you don’t have to tackle this task alone. Allow us at Boston Metro Advisor to help! We are a wealth management practice that specializes in life planning and will work alongside your attorney and your CPA to be sure all of your legal and financial needs are aligned. Contact us for a complimentary consultation by calling (781) 995-0253 or email me directly at firstname.lastname@example.org today!
Paul McNulty is the founder of Boston Metro Advisor with over 20 years of experience helping people navigate the ups and downs of the economy toward the financial future they envision. His education consists of a Bachelor of Science in business administration from the University of Rhode Island and the CERTIFIED FINANCIAL PLANNER™ (CFP®) professional designation.
Paul’s experience and education have made him a multi-faceted professional capable of assisting people with virtually all their financial needs. His services include every facet of retirement planning, from 401(k) rollover services and income planning to wealth management and estate planning. Paul has been active in his community over the years as a youth sports coach. When he’s not spending time with his wife, Cindy, and their two children, who are both recent college graduates, Paul enjoys reading, playing golf, and fishing. Learn more about Paul by connecting with him on LinkedIn.
This information is not intended to be a substitute for specific individualized tax or legal advice.
We suggest that you discuss your specific situation with a qualified tax or legal advisor.