People often ask “What is Estate Planning?”

It is simply preparing for the management and distribution of a persons assets at their death. Estate Planning involves weighing various personal and financial decisions and creating legal arrangements to carry them out. It is generally done through the use of Wills, Trusts, insurance policies, beneficiary designations, and other arrangements like that.

The goal is generally to balance the person’s wishes for distribution and control against the tax consequences of those actions. Michael’s income tax professor in law school used to say if you want more control, you’ll have more taxes, and if you want less taxes, you have to give up more control. (Giving up control is to your loved ones through gifting and the use of trusts.)

Estate Planning also includes arranging to make sure that someone else can manage your property, make health care decisions for you, and raise your children in the event of death of incapacity.

 

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