When Pablo Picasso died in 1973, he left an estate worth $300 million, but no will specifying how to distribute his wealth. Picasso could have used a simple estate plan to avoid a family dispute that lasted four years and consumed 10% of his fortune.
A Better Alternative
Although you may not want to think about what happens after you die, an estate plan ensures that your heirs – family, friends or even charities – receive their inheritances according to your instructions.
A well-crafted estate plan will not only help eliminate confusion for your heirs, but also helps protect them – and you – from estate tax burdens by transferring your assets at the lowest possible cost.
A sound estate plan may include the following elements:
- A professionally drafted will outlining how to distribute your property after your death. It can also address issues such as the future care of minor children, and help limit probate costs. A living will spells out your wishes for your own health care.
- A trust provides security for you and your beneficiaries, and may help protect assets from taxes. With a living trust, for example, you maintain control of your assets during your lifetime while keeping them private and avoiding the time and expense of probate upon your death. Also, you select a trustee who manages and distributes remaining assets to your beneficiaries according to terms you set.
- Insurance can help heirs meet survivor and estate settlement expenses. The appropriate type and level of insurance varies according to your personal circumstances.
- Qualified executors and trustees carry out your wishes and manage your estate. You may choose an individual, such as an attorney or accountant, or an entity that has expertise in taxation, estate law, or money management.
Now’s the Time
An estate plan may help preserve the wealth you have worked so hard to build. Do not put off completing an essential step in the financial planning process that benefits you as well as your heirs. Talk to your Fifth Third Private Bank advisor about the role he or she can play in creating a flexible estate plan to address your unique needs.
Fifth Third Bank does not provide tax or legal advice. Please consult your tax adviser or attorney before making any decisions or taking any action based on this information. This information is provided for educational purposes only and does not constitute the rendering of tax or legal advice.
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