While so many devote their time towards things like planning rewarding vacations, remodeling their homes, and picking out the best schools for their kids, estate planning is a commonly overlooked priority. Because it’s easier to avoid the topic of our untimely death and what might happen to those we love that will be left behind, things like estate planning, life insurance, and picking beneficiaries are pretty unfavorable endeavors for most.
Furthermore, estate planning becomes even more critical when caring for elderly parents. Check out https://www.smbceo.com/2022/11/09/5-estate-planning-tips-to-protect-your-family-and-assets/ to read some experts’ tips regarding estate planning and how it can protect your assets and family. Unfortunately, there’s hardly enough time left for seniors to push off the responsibility of estate planning any longer. And there’s no doubt that you want your parents’ assets to be divided in the best way possible.
Bryant Elder Law can help simplify the process of estate planning for your senior parents, while financial advisors are beneficial for high-net-worth individuals. And these are the significant benefits you can expect.
The primary reason estate planning is crucial is to ensure that wealth and assets are divided relatively amongst chosen beneficiaries.
Furthermore, estate planning is still relevant even if your parents aren’t high-net-worth individuals. Estate planning is for anyone that wants their assets to be transferred following their death. And it’s pretty crucial to stress the importance of this when getting your parents up to speed with developing their estate plan and the importance of devoting some time to the vital process.
Spare Heirs A Hefty Tax Fee
Estate planning aims to protect loved ones, which spans further than ensuring beneficiaries receive fairly divided assets and wealth. It will also ensure beneficiaries don’t have to pay a hefty inheritance tax fee.
A tax fee can easily set loved ones back. So this is a significant benefit, particularly for individuals with smaller net worths, who would like their loved ones to receive as much as possible. Because estate planning is the best way to eliminate as much inheritance tax as possible, it’s a wise decision.
Eliminate Potential Family Feuds
It’s not at all uncommon for family feuds to arise when there’s an estate to divide, especially when there are no set guidelines for how the estate will be divided. Some family members may feel entitled to more, setting off a great deal of drama among loved ones. Fortunately, estate planning will end this before it can even start.
That said, the best way to ensure feuds do not arise is to ensure inheritance is divided as somewhat as possible between beneficiaries.
It’s critical to speak to your senior parents about the importance of estate planning. You can assist your parents in dividing their assets or recommend that they rely on an unbias attorney to walk them through the process while having their best interests at heart.
There are also several critical details your parents must keep in mind when developing an estate plan, and these include updating insurance, listing assets, and choosing an estate executor. However, with the help of an expert estate attorney, the process will be substantially straightforward.
Steps to Complete Estate Plan for Elderly Parents
It’s challenging to talk and imagine our parents’ passing. As a result, many people shy away from talking about estate planning for aging parents. Unfortunately, when parents age, many elder children encounter difficulties juggling their parents’ financial and medical requirements. This is especially true if the parents have lost capacity and have not left an estate plan.
Making last-minute plans, gathering paperwork, and paying for care can be challenging, particularly if siblings and other family members disagree about what their parents’ intentions would have been.
If you take the time to sit down with your parents and learn about their preferences, the components of their estate, and any advance preparations they made, you can lessen stress, anguish, pain, and protracted family disputes. This section will walk you through the process of creating an estate plan for your elderly parents.
Have A Conversation with Your Elderly Parents About Estate Planning
It’s a difficult subject to have with aging parents, but it’s essential. Unfortunately, many families avoid having these discussions because they lack knowledge about estate planning, believe the time is not suitable, or are concerned about how their relatives may react.
Your elderly parents’ estate planning should be the subject of ongoing rather than one-time discussion. As a result, you should think about the optimum moment to initiate this dialogue and perhaps even take small steps.
Help Your Elderly Parents Determine Their Estate Planning Goals
Creating a Last Will and Testament or a Trust is probably what comes to mind when you consider estate planning for elderly parents. On the contrary, because so much thought goes into the process, estate planning for elderly parents is more complete. You should first consider the goals you have for your estate strategy.
When selecting which estate plan is appropriate for your parents, it will be useful to assist them in defining their estate planning objectives. Once you understand their objectives, you might see that they want more paperwork to guarantee they have a suitable estate plan.
Record The Value of Your Parent’s Assets and Debts
You should list all of your elderly parents’ assets before you start estate planning for them. By having everything in writing, you can better comprehend how the remaining assets will be divided to the beneficiaries of the decedent’s choice, which simplifies the estate planning process. Additionally, bear in mind any financial obligations your parents may have, such as credit card debt, mortgages, and auto loans.
You should deduct the total worth of your parent’s assets from any debts they have after listing all of their assets and liabilities. The remainder of the estate, sometimes referred to as the residual estate, will be used to pay off any debts before beneficiaries are given their share of the estate. Making a notation of it will prevent the present from being unintentionally sold to settle a debt. If your parents want to leave something to a specified beneficiary, they should do so.
You and your elderly parents will be able to understand the remainder of their inheritance better now that you have all of this information. If your parents discover that the size of their inheritance is insufficient to achieve their objectives, they should devise a strategy to increase their income, settle any remaining debt, sell assets, or get life insurance.
Select an Agent for Your Elderly Parents’ Financial Affairs
Choosing an agent to handle their financial affairs is a crucial component of estate planning for aging parents. Nobody wants to be concerned about having access to money in the event of a serious accident, disability, or bad prognosis. These occurrences typically come out of nowhere, and nobody is ready for them. Making a Financial Power of Attorney is crucial when estate planning for elderly parents. By drafting this document in advance, you can take control of your parents’ finances without having to go to court.
Gather Important Documents
It’s crucial to acquire the relevant paperwork and keep it all together when you start estate planning for elderly parents. When all of these documents are in one location, estate administration may begin more easily.
Deeds, titles, bank account information, insurance details, beneficiary designations, marriage, divorce, and other separation documents, birth certificates, adoption records, and other vital records, as well as business investment and share certificates, are some documents that you should keep together. These documents can be used to demonstrate ownership and reveal any relationships that have changed over time. Furthermore, preserving these records alongside your parent’s estate plan will make the procedure less complicated and difficult.
Document Burial Wishes
When discussing and documenting your elderly parents’ burial preferences, estate planning is a great time to do so. You should talk about whether they want to be buried or cremated as well as how you should share their ashes. If they desire to be buried, talk about the best location for the burial. They should put it in writing and let their family and loved ones know if they desire particular funeral arrangements. If they want to adhere to certain religious limitations, this is very crucial.
Talking and thinking about our parents’ passing is difficult. As a result, many people shy away from discussing inheritance planning with their aging parents. Unfortunately, when parents age, many adults find themselves in challenging situations as they try to manage their parents’ financial and healthcare needs. Now is the time to really consider developing an estate plan for your elderly parents because they can easily lose the ability to manage their own affairs. We hope that this article will act as a guide for you as you navigate the difficult conversations with your parents regarding their passing and come to understand their preferences and any advance planning they may make.