Tips for making an estate plan better

On Behalf of | Nov 7, 2019 | Trusts

Many Nevada residents may have prepared an estate plan at some point in their lives and assumed that is sufficient, but this is not always the case. Estate plans can often be improved or may need changes over time. For example, people may not have life insurance policies. A life insurance policy can have a number of uses. It can provide immediate funds for expenses associated with the estate. It can also help the family financially if they were depending on the income of the decedent. Additionally, life insurance can provide tax-free funding to the next generation.

People may also want to consider having a trust. This allows the estate to avoid the probate process, and it can be useful in a number of ways. A trust is not the right vehicle for people who are short on funds and whose estates are relatively straightforward, but others may benefit from it.

Charitable giving can also be incorporated into an estate plan. This can be done with a gift or with a charitable remainder trust. Finally, beneficiary designations should be reviewed every few years and updated if necessary. Assets such as IRAs, 401(k)s and life insurance policies are passed using these, but if they are out of date, the wrong person could inherit.

An attorney might be able to assist a person in determining what changes the estate plan might need and what type of trust might be useful. For example, the client might have a loved one who has special needs and who receives government benefits. A direct inheritance could make this person ineligible for further benefits, but creating a special needs trust instead could establish a fund for the person without endangering those benefits.