Community
BY GRACIE WARHURST
Financial expert provides estate planning insight
relationship is created, would be a triggering event. What are some things that people should know when revising or starting their estate planning? How do you want your assets distributed? And, what’s the most efficient way to distribute them without leaving a lump sum to the IRS? When starting this, sit down with your signifi- cant other ... and have that conversation. Make a determination as to who you want to have what. It may be that you’re philanthropic in nature. How do you want to distribute estate assets to charities or churches, alma maters, whatever the case might be? Have that discussion long before you start visiting with the attorney. If you’re not sure, you’re going to have a lot of changes to your will, which is going to cost you more money to have it done. What tools are available to help with estate planning? We all turn to the internet for everything today, don’t we? And so there are some do-it-yourself tools [like] financial calculators. There are some online services for creating wills that may or may not be helpful. So there may be some tools that will help people at least start the thought process. I’m weary, though, for online tools only because online tools cannot measure someone’s attitude. When you’re sitting in front of either a financial adviser or an attorney, someone there is measuring the attitude, not just giving you information. They help you understand if that really truly is going to be of importance to you or not. How can families help each other during the estate planning process? Ask the question. Don’t be afraid to say, “What have you done?”
David Boren, vice president of Chisholm Trail Financial Group, which provides services in Central Texas, spoke with Community Impact about best practices for estate planning. He has 40 years of experience as a certified financial planner. What are the most common mistakes people make when estate planning, and how can they be avoided? The worst thing in the world in the state of Texas is to die intestate. The state intestate laws say that if you don’t have a will, then, if you have a spouse, significant other or someone that you are in a legal relationship with, 50% goes to them. And for any children, 50% goes to the children whether you want it to or not. So it’s important that someone take the steps necessary to start this process. I think one of the most common mistakes is the inefficient titling of assets. There are so many asset classes that can pass outside of probate and against a will, such as life insurance, [which has] beneficia- ries. Retirement accounts can have beneficiaries. So can other asset classes [and] can be made to be payable upon death. Some of the other things that happen is that they start the process, and then they don’t finish it. How often should someone review or update their will or estate plan? I think at least a three-to-five-year period. Life events will trigger [a revision]. If, in fact, you have a relationship, a lifelong relationship, and that ends either in death or divorce, there may need to be a revision to the estate plan. If you have children that you are passing assets to, and there is a divorce there, you may want to revisit. So anything that terminates a lifelong relationship, or [if] a new
COURTESY CHISHOLM TRAIL FINANCIAL GROUP
If someone is in the middle of the process and you sense that they are procrastinating about completing it, give them a deadline. I think asking someone to voice their goals, asking where the documents are, when they recently checked them [is important]. And if you’re going to be a beneficiary, I think you have the right to say, “What am I looking at?” Because so many beneficiaries, especially with a great transfer of wealth, are not prepared to receive that much wealth. [These questions] are not only applicable to seniors; they’re applicable to anyone.
This interview has been edited for length and clarity. For a longer version, visit communityimpact.com .
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