Estate Planning Tips for the Wealthy | Fee-Only Financial Planners Long Island

Estate Planning Tips for the Wealthy

Estate Planning Tips for the Wealthy

While accumulating wealth is important, one key step that many individuals postpone is creating a plan that protects that wealth. Unfortunately, such delay can cause them and their loved ones to risk losing a great amount of money to undue taxation, along with being exposed to other potential pitfalls.

What is Estate Planning?

Estate planning involves anticipating—and then arranging—for the proper disposal of your assets in the event of death or incapacity. Typically, this process also includes developing a plan that helps to reduce or eliminate estate taxes as well as bequeathing certain assets to heirs.

Proper estate planning goes far beyond just having a will. It can also include creating trusts so that funds can be easily transferred to heirs and bypass probate as well as setting up a health care proxy or power of attorney so that the management of financial affairs can be passed to another in the event an individual becomes physically or mentally unable to do so.

How Estate Planning Works

Estate planning can include the accumulation, protection, and eventual distribution of your assets. Overall, estate planning involves three primary areas:

• Distributing assets to intended beneficiaries

• Ensuring that heirs are not left with a hefty estate tax burden

• Providing a way for important financial and medical decisions to be made
Estate Planning Checklist

Estate planning involves many “moving parts,” and it can differ from person to person, depending on someone’s specific situation and goals. In most cases, however, key estate planning tasks include the following:

• Creating a will

• Naming an executor of the estate who will ensure that the terms of the will are carried out

• Setting up trust accounts to reduce or eliminate estate taxes

• Having durable powers of attorney in place that will direct other assets

• Establishing a guardian for living dependents (if applicable)

• Naming beneficiaries on life insurance policies as well as on other accounts, such as IRAs (individual Retirement Accounts) and employer-sponsored retirement plans

Estate planning may even include reducing the value of an estate to also reduce the taxable portion of it.

The Benefits of Having a Solid Estate Plan

There are numerous benefits to having a good, solid estate plan. In addition to avoiding or minimizing estate taxes and the proper passing of assets, other advantages are shown below.

• Protecting assets from lawsuits, creditors, divorce, and other types of claims

• Safeguarding assets from a surviving spouse’s future children or stepchildren

• Ensuring that children or other heirs with special needs will receive proper care—often without losing any government assistance that they may currently qualify for

An estate plan can also include a “no contest” provision that discourages potential challenges to the plan itself. Doing this can offer additional assurance that your wishes will be honored.

Some estate plans may even have a “spendthrift” clause whereby assets can be protected from heirs who may not make wise financial decisions. This provision is especially important if such beneficiaries will be receiving a substantial sum of money. Overall, a solid estate plan can offer peace of mind by knowing that loved ones will be protected and provided for and that all financial affairs are in order.

Who Should Consider Having an Estate Plan

With very few exceptions, technically, everyone has an estate. While having an estate plan may not be for everyone, it is important for most—even if you don’t have significant assets—because estate planning isn’t just about protecting money. It’s also about protecting loved ones.

Those who do not properly consider the proper disposition of funds and other elements of estate planning could essentially be handing over control to their particular state regarding who will get their assets. In addition, other potential burdens can include loss of funds to estate taxes, unnecessary legal fees, incurring the probate process, and even custody issues for those who have minor children.

Common Planning Mistakes

Although your estate plan may be rock solid once it is created, you need to be aware of some possible mistakes. One of the most common planning issues comes with not regularly reviewing—and subsequently altering—the plan.

Once an estate plan is complete, however, the process is not over. In fact, in many ways, it is just beginning. As people’s lives and financial situations change, an estate plan should also change.

Major life events, such as marriage or divorce, a birth or death in the family, and the starting or selling of a business, will all affect an estate plan. By not keeping the plan up to date, loved ones could suffer undue financial burdens and even unintentional disinheritance.

Another key mistake people often make is trying to do everything by themselves. Properly planning an estate involves many legal and financial intricacies that need to be coordinated. That, coupled with ever-changing financial and tax-related legislation, could mean that an improperly constructed estate plan is worthless.

What may appear to be a simple error, such as improper titling of assets, could actually turn out to cost hundreds of thousands of dollars—or more. Working with professionals who specialize in estate planning is absolutely essential.

Taking the Next Step

When seeking the right professionals to guide you through the estate planning process, experience is everything, and R.W. Roge and Company has been one of the nation’s most highly regarded wealth management firms since 1986.

Our business was built on assisting clients with capital preservation and providing impartial and exceptional advice. For more than two decades, we’ve helped clients who have accumulated a significant amount of wealth as well as those who are just starting to build their asset base.

To receive more information as to how we can help you protect those you love, please visit us at

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