Estate Planning Tips for Baby Boomers

estate planning in alabama
Estate planning can seem daunting, but with assistance from Alabama Family Trust, the process becomes more manageable. If you are a Baby Boomer who is ready to investigate estate planning in Alabama, there are two main questions to ask yourself:
What happens to your estate when you die?
What happens to your estate if your health deteriorates and you must rely on others for permanent caregiving?
Creating a proper estate plan can help protect your assets and ensure that your wishes are carried out in the event of death, or if you require long-term care due to disability or illness.

Long-Term Care

One thing to keep in mind regarding long-term care is that it’s best not to confine your money to long-term investments where you have no liquidity, or investments that require you to pay a penalty to get your money back (like annuities). Additionally, don’t imprison yourself in an investment that should be sold just so that you can avoid capital gains taxes. While taxes are always a consideration, you may need those funds for your long-term care needs, so you must weigh the risks and benefits of remaining in such an investment.
Be sure that you have established the right advance directives, such as power of attorney and health care proxy. Be wary of forms downloaded from the Internet, as they may not be complete or valid.
Take advantage of possible penalty-free transfers when applying for government benefits such as Medicaid. It is a common belief that an individual must spend down their savings before applying for Medicaid, but this is not accurate information.

Financial Planning

There are five key areas of financial planning when it comes to estates.

  • Tax analysis can eliminate unnecessary taxes, check for CPA errors, and reallocate taxable interest and dividends into tax-free income, like municipal bonds.
  • Estate planning can assist in avoiding probate and unnecessary death tax and ensuring that assets make it into the heirs’ hands as smoothly as possible.
  • Retirement planning ensures that all beneficiaries are properly titled and should incude a retirement cash flow analysis.
  • Life insurance policy analysis makes sure that existing policies are still appropriate. For example do you still need to pay life insurance premiums if your assets have reached a certain level?
  • Investment planning ensures that the investment portfolio is appropriately diversified and balanced.

Hiring an Attorney for Estate Planning in Alabama

An attorney that specializes in estate planning is a critical part of the estate planning process. Not only will they draft all of your legal documents, they will also ensure that all forms comply with the laws of your state. While Alabama Family Trust cannot offer legal services, we strongly encourage you to see an attorney who focuses on elder law.

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Contact Alabama Family Trust via the contact link below to learn more about special needs trust funds.

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