Estate Planning: An Achievable New Year's Resolution

The challenges of losing weight, saving money or trying something new are resolutions we commonly make at the new year. You may not hear as much about creating an estate plan, but it's one of the best goals you can set for yourself.

Why estate planning is important

Whatever your age or how much money you currently have in the bank, estate planning now can help your heirs sidestep complicated tax and legal issues later.

With thoughtful planning, you can also map out the kind of personal legacy you wish to leave, be it simply protecting your loved ones and assets or making a generous gift to your favorite charity or alma mater.

In other words, putting a plan in place this year can give you greater peace of mind and comfort or inspire others down the road.

4 simple steps to creating an estate plan

While it may seem daunting at first, creating an estate plan is an achievable goal, especially when you’ve tapped proper guidance and resources.

Below, and as part of our commitment to helping preserve your personal and familial legacy, the RBFCU Trust Services Team has provided four simple steps to create your estate plan this year.

1. Evaluate your financial situation

To begin, take pen to paper (or keyboard to spreadsheet) and compile a comprehensive list of your assets and debts. This inventory will not only give you a better understanding of your financial status but also help you calculate your net worth.

Your list should include the following:

Assets

• Bank and investment accounts
• Personal property (i.e., jewelry, collectibles, motor vehicles)
• Retirement plans
• Life insurance
• Real estate

Debts

• Credit cards
• Auto loans
• Personal loans
• Student loans
• Mortgages

2. Determine your beneficiaries

Anyone you name in your estate plan as an heir is considered a beneficiary. Many people choose their spouse, children or even a charity to inherit their belongings when the time comes.

While this personal decision may seem easy, understanding particular implications and how certain assets are distributed can be quite complicated. There are legal restrictions, for instance, on what minor children can inherit and how.

Yet by taking active steps to get the paperwork in order this year, you can make things easier on your heirs and perhaps help them avoid a costly, time-consuming probate process. Creating a list of your beneficiaries and reviewing the tax impacts and distribution methods with qualified professionals is a big step toward ensuring your wishes are carried out when you’re gone.

3. Develop a contingency plan

After you’ve determined the value of your estate and mapped out a draft plan for its distribution to your beneficiaries, take time to consider possible issues — both seen and unforeseen — that may come up.

This brainstorming will help you develop a contingency plan for your wealth, health care and heirs. Contemplate what might happen if you (or close living relatives) were to become very ill and need care. How would you want to provide for them? Think through, too, whom you might name as a contingency beneficiary if a primary beneficiary were to predecease you.

Jot down your contingency plan concerns and objectives. Then, schedule time to review it with an experienced estate planning attorney and financial advisor so that all your estate planning documents (e.g., will, living trust, power of attorney, medical power of attorney, etc.) are completed correctly and placed in the hands of a professional whom you trust to ensure your wishes are followed.

4. Revisit your estate plan periodically (or as needed)

Once you have established your estate plan, schedule time on your calendar to review it regularly. Depending upon the size and complexity of your estate, you may wish to look at your plan every few years, annually, quarterly or monthly.

In addition to making routine adjustments, note that you may want to update the documents after key life events, such as (but not limited to):

• The birth or adoption of a child or grandchild
• Marriage or divorce
• Death of a beneficiary
• Inheritance
• A change in careers
• The purchase of a house, land or vehicle
• Significant gains or losses in investments
• The creation, sale or closure of a small business
• Changes in federal or state estate or tax laws

Where to turn for estate planning assistance

If you decide to create an estate plan this year, remember that you don't have to do it alone. By selecting the right professional from the outset and building a relationship together around your estate plans, you’ll likely enjoy even greater peace of mind in the years to come.

RBFCU Trust Services, along with our network of attorneys, can help develop a customized and structured financial strategy that protects your finances and supports your loved ones for generations. We offer a continuum of estate planning support, and our team is comprised of highly trained, licensed professionals committed to helping you.

Schedule a no-cost, no-obligation appointment today.

210-637-4117 | trustservices@rbfcu.org | rbfcu.org/trustservices

RBFCU Trust Services is a division of RBFCU Investments Group LLC. RBFCU Investments Group LLC is a wholly-owned subsidiary of RBFCU Services LLC. RBFCU Services LLC is affiliated with Randolph-Brooks Federal Credit Union (RBFCU). Trust services available through Members Trust Company, a federal thrift regulated by the Office of the Comptroller of the Currency.