Estate Planning is an important gift you can bequeath to your loved ones, to reduce their painful stress load during an already stressful time. If you’ve been putting off your estate planning, taking the initial steps can be daunting—but liberating. In our last letter (which is also posted on our website for your reference, https://warburtoncapital.com) we identified two common hurdles to completing an Estate Plan: Hurdle #1: Deciding Who Gets What and Hurdle #2: Making It Legal.
Let’s now review some Common Estate Planning Techniques:
A Will: You typically name one or more executors to move your estate through probate – the legal process for carrying out the terms in your will in court. Your executors can be family members or professionals such as a bank’s trust services. But unless you transfer your property exclusively by operation of law, you will most likely have to probate this in court.
A Revocable Living Trust (RLT): A trust is kind of like a contract with yourselves and your Successor Trustees. You (and they) will be required to manage your assets as the Trust dictates. As stated above, you will also still have a will to settle any assets that remain outside of your trust(s). But an RLT lets the bulk – if not all – of your estate bypass public probate, which usually means a more rapid, private, and cost-effective settlement. It also can resolve complex family dynamics that a will alone cannot address. For example: What if you want your second spouse to be supported financially during their lifetime, with the remainder left to children from a first marriage? What if your children aren’t yet ready to manage their inheritance? What if an heir’s spouse is a spendthrift? With an RLT, you can establish successor trusts and trustees to oversee your estate over time and across these and other scenarios. You may want to seriously consider a corporate successor trustee to diminish friction among heirs and take a substantial burden off them as well. Warburton Capital now offers Trust Representative Services through our relationship with National Advisors Trust Company and can help fill this role for you.
Other Specialized Trusts: If you’re preparing for a business succession, philanthropic endowment, multigenerational legacy, or similar higher goals, a specialized trust may help minimize tax ramifications and facilitate optimal outcomes. Various trusts can also be combined with targeted insurance coverage, to help fund critical financial gaps. For example, what if you co-own a business, and your spouse would prefer to be bought out by your partners once you pass? Life insurance may be an affordable way to resolve the challenge.
Now that we have identified some basic estate planning tactics, our next and final letter in this series (which will also be posted on our website, https://warburtoncapital.com) will walk through a final Hurdle: Getting It Together. Stay tuned!
If you are a client of our firm, we would be happy to do a high-level review of your Estate Plan, provide you with some analysis, on background, and connect you with an Attorney to finalize any changes. We also offer an informative Estate Planning 101 meeting for clients of ours who have never had an Estate Plan or need a refresher. If you are not a client of our firm, please consider reaching out to us to see if we can help you! If you have any questions in the meantime, or this has caused you to think about your own estate planning – please don’t hesitate to reach out to us. Our phone number is (918) 794-3000 or you can email wcm@warburtoncapital.com.
