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Kent Estate Administration and Probate Law Blog

Essential estate planning steps

Many Kent area residents have taken the time to create an estate plan. There are many reasons why an estate plan is essential for all families and we'd like to take the time to review a few important estate planning steps.

Estate planning is important for a family to protect their interests. While working through completing an estate plan, there are important matters to keep in mind. First, enlisting the help of a qualified team is important. Whether that includes financial planners, attorneys, etc., having expert advice is always a good idea.

Estate planning for cryptocurrency

Estate planning is not just for the traditional wills and trusts. Estate planning is a process that is constantly evolving with new items that need to be included. One such topic is a new form of currency called cryptocurrency.

Including cryptocurrency is an estate plan is something many Kent area residents need to do. Digital wealth can be complicated, and it is important to have a plan for it when an owner passes away. It is no longer the norm to have a will on a piece of paper filed in a safety deposit box. Cryptocurrency and other digital assets have made estate planning more complicated. As always, it is important to let heirs know about all assets, their locations, and how to access them. A record of all assets needs to be made and shared with trusted people. Those who are active traders should update their lists weekly, while less active traders can update the lists once a year.

Incorporating an educational trust into an estate plan

Higher education is a priority for many Kent area residents. The cost of higher education is something many parents save for, but they can still fall short. Many grandparents and other family members want to contribute to their loved one's educational expenses.

One way to help a family member with educational expenses is to establish a trust fund within their estate plan. One trust fund could be established for all family members; this is sometimes called a pot trust. This trust can be used by specified beneficiaries, who can all withdraw funds from it. A pot trust can be tricky if some beneficiaries withdraw more from it than others or if the funds are depleted from older beneficiaries before a younger beneficiary can use them. A person could also elect to create a separate trust for each beneficiary.

Incorporating charitable giving into an estate plan

Many Kent area residents understand the importance of charitable giving. There are many local and national charities that people give to and find their values are aligned with the charity's mission. There are ways for a family to incorporate charitable giving into their estate plan.

For many people, an estate plan is a way to create a legacy for themselves. There are ways that a person can establish their legacy using their estate plan. Charitable giving is often included in an estate plan. It benefits families by allowing them to designate charities that are important to them and leaving a legacy for the younger generation. The first step of charitable giving is choosing charities that are meaningful to the giver. Once the charities have been chosen, it is then appropriate to decide how much those charities will receive. It is possible to donate money, artwork, securities, real estate, and other assets. After assets are chosen, a donor needs to figure out how the gifts will be made. Assets can be designated in a will or a charitable trust can be created.

Estate planning for millennials

Kent area residents should understand that estate planning is not just for the older generation. Although many people assume that those who have a great amount of assets or are approaching the end of their lives should have an estate plan, estate planning is actually for everyone, millennials included.

No one finds the planning for what would happen if they suffer an untimely demise. It's not a pleasant topic for most discussions and can be depressing. But, even millennials can benefit from an estate plan. For millennials, having a will can dictate where assets should go upon a person's death. It can also be the place where guardians are named for children and name an executor for the estate. Another important document for millennials is a living will. This document can list healthcare wishes in case a person has a medical crisis where they are not able to communicate their desires. A healthcare proxy should also be designated to make healthcare decisions in the event of a medical emergency. And, naming a durable power of attorney to handle financial decisions if a person is no longer able to make these decisions on their own.

Updating an estate plan? Don't forget about beneficiaries

Kent area residents who have an estate plan may think that they are set. Creating an estate plan is a good step to ensure that a person's assets and wishes will be followed after their death. However, an estate plan should also be reviewed periodically to make sure everything is still accurate.

When reviewing an estate plan, checking out who the designated beneficiaries are is one of the most important steps. If beneficiaries are not reviewed periodically, several problems can ensue. Many times, the beneficiary named has passed away. For instance, people in their first jobs may name their parents as beneficiaries of a life insurance policy and, if the beneficiary isn't changed, the estate would need to go through probate. Also, many people have a family that has had multiple marriages, stepchildren, etc. A person can name one child as a beneficiary of a life insurance policy, while a stepchild is named in the will. These inconsistencies can lead to a probate dispute. In addition, changes to beneficiaries should occur if a beneficiary dies, receives public assistance, a divorce occurs, or a beneficiary has a serious medical diagnosis.

What are the benefits of a QTIP trust?

There are many families in the Kent area who have had a divorce in the family. Especially for older residents, divorce is common. Estate planning for families who have multiple spouses and children from multiple marriages can be complicated. A QTIP trust may be a good option in these situations.

The divorce rate for older Americans has steadily gone up since 1990. Older Americans, for whatever reason, have decided to divorce and remarry in record numbers. Because of this, many have ex-spouses and children from multiple marriages that make estate planning complicated. A Qualified Terminable Interest Property trust may be an estate document that should be considered.

Bequests and estate planning

Many Kent area residents support their favorite charities. Charitable giving is an important concern for many people, and the ability to incorporate this into an estate plan is something that many people are interested in. Bequests in a will are a popular form of supporting a charity after death.

There are different types of bequests that a person can specify in their will. One is a pecuniary bequest. This is where a certain dollar amount is left to a charity. A specific bequest is when certain items are given to charity, like a painting or antique car. A residuary bequest is when a charity receives all or part of the remainder of the donor's assets after everything else has been distributed and taxes have been paid. There is also a contingent bequest where a charity receives the donation if a certain thing happens, like a donor not being survived by a spouse.

Failing to have an estate plan can lead to family turmoil

Although many Kent area residents understand the importance of having an estate plan, nearly 60% of Americans have not taken the time to create one. Many people think they don't have enough assets to worry about creating a plan, but there are many reasons why having an estate plan is important.

If a person passes away without an estate plan, the legal system will decide who gets the assets and who will care for the children left behind. In addition to a will, beneficiaries need to be specified on bank accounts, retirement accounts, etc. Healthcare directives should also be considered in the event a person becomes incapacitated and is unable to make decisions for themselves. A healthcare power of attorney can be specified as well as a power of attorney for financial decisions. All important documents should be recorded; recording these documents can be such a blessing for family members who need this information after a death.

Why do you need an estate plan?

Many Kent area families understand the importance of an estate plan. But, over 75% of people do not have a will and a large percentage of the rest of the population do not have an estate plan in place. Not having an estate plan puts a person's assets in jeopardy when they pass away. There are many reasons why having an estate plan is important, regardless of age.

Many times, people do not think about estate planning until they are older, retired, and accumulated a large amount of wealth. But, anyone can benefit from an estate plan, including young families and single people. There are aspects of an estate plan that can appeal to everyone. One is to ensure a person's wishes are carried out upon their death. These wishes can include who will receive their assets, who will take care of their children, or who will take care of any pets. Final wishes can also spell out how a person would like their children raised, including religion preferences and other values. An estate plan protects a family by avoiding legal hassles, minimizing taxes, and ensuring a family's privacy.

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Phone: 425-336-2908
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