When pondering the inevitable, put an estate plan in place

Many families have vacation plans this busy summer travel season, but they may not have their estate plans in place. Still, taking that next vacation can sometimes trigger a family member to think about the benefits of “estate planning,” that is, planning for what happens to your money and assets after you die.

Other examples of when to consider estate planning may include marriage, divorce, remarriage, birth of children, changes in domicile, as well as changes to assets and tax laws.

The estate planning process should not be one of fear but rather one of comfort and security, knowing that your family will be provided for in the manner you choose without triggering significant tax consequences from one generation to the next. Oftentimes, families do not communicate with their loved ones about death and their financial affairs or how they would like to see their final wishes carried out for the next generation.

The most common reasons why one may consider estate planning is to ensure that family members and loved ones are provided for in the manner they decided and not by the “intestacy laws” of Massachusetts, to avoid the lengthy and sometimes costly probate process and to minimize any possible estate tax consequences at the federal and state level.

Before beginning the estate planning process, you should consult with an estate planning attorney, an accountant and a financial advisor to ensure that your plan is developed and carried out in a strategic and beneficial manner, even after your death. It is important to work with trusted legal and financial professionals to keep you informed of the changes in the estate tax laws.

An initial step in the estate planning process is to conduct an inventory of all your assets to determine the ownership of your assets. This accounting will help to determine whether your assets would be subject to the “probate process,” a time-consuming process that may not deliver your assets where you want them to go.

For example, if an asset is held jointly or a beneficiary has been designated (such as on a life insurance policy or IRA), then those assets will not be subject to probate.

There are a number of estate planning tools (such as “revocable living trusts”) that may be drafted to allow the transfer of your assets without being subject to the probate process.

It is important to think carefully about the people you would like to nominate to control your assets after you are not around. These include your executor, trustee, guardian, attorney in fact and health-care agent, as well as alternates for each of these categories.

Take the time in advance to communicate with the individuals you would like to designate and inform them of their duties and responsibilities because they may or may not be inclined for the role.

As you can see, the estate planning process should be used as an opportunity to discuss important family issues in a beneficial manner to avoid possible family disputes, estate tax consequences and the lengthy probate process.

— Daniela G. Messina

Salem attorney Daniela G. Messina focuses on family law and estate planning. She can be contacted at  dgm at dgm-law.com. href=”http://exhibitanewsboston.com/files/2008/08/crash_course_last_will.jpg”>