A Refresher on Estate Planning Basics Epstein & White

Estate planning is a big deal. It’s a way for us to leave what we’ve built over the course of our lives to our loved ones. Gifts of property and belongings can pass on a sense of family, care, and love and can also help your loved ones financially.

So, what is the first and most important thing to do when it comes to estate planning? This may seem obvious, but the first thing is to do it. Plan out your estate. Think about who is getting what, and be specific about the details. Sure, there are plenty of other aspects to estate planning that matter, but if you have no plan at all and nothing set up, then none of those other things matter.

Another thing to consider, especially when it comes to your retirement accounts, is to ensure that you have the right beneficiary listed and that their name is spelled right. A simple mistake like spelling a name wrong can lead to a lot of problems when your estate is being handled. Additionally, it can be a good idea to have what is called a contingent beneficiary on your retirement accounts.[1] This alternate beneficiary will gain the funds in your accounts if your first listed beneficiary (usually you) is not able to receive them.[1] This allows you to pass on a retirement account seamlessly after your passing.

Another major concern when it comes to estate planning is taxes. Planning around taxes is a key part of anyone’s financial life. Tax mistakes can lead to the loss of more of your hard-earned money than you expected. One thing you can do to avoid some estate taxes is to give away some of your money before you pass away. The limit for tax-free gifts per year as of 2023 is $17,000.[2] This means that you can give any individual up to $17,000 per year as long as you don’t cross your lifetime gift tax amount, which is $12.92 million in 2023.[2] However, if you don’t give gifts while you’re alive, this tax-exempt limit doesn’t apply, and the full estate tax will be levied on whatever you leave to your heirs. If you are concerned about the amount of taxes that will be taken out of your estate, gifts can be a great way to mitigate some of those taxes.

Estate planning is a complicated affair. Even small mistakes can lead to big headaches for your loved ones. Retirement planning is no different. If you are looking for someone to help guide you through planning your retirement, Click HERE to reach out to one of our advisors today at Mercer Advisors, Formerly Epstein & White for a complimentary review of your situation.

 

Epstein & White is a tradename. All services provided by Epstein & White investment professionals are provided in their individual capacities as investment adviser representatives of Mercer Global Advisors Inc. (“Mercer Advisors”), an SEC registered investment adviser principally located in Denver, Colorado, with various branch offices throughout the United States doing business under different tradenames, including Epstein & White. Information contained herein is for informational and illustrative purposes only and general in nature. It should not be considered investment advice or a recommendation to buy or sell any type of securities or insurance products and no investment decision should be made based solely on any information provided herein. Investing involves risk, including the possible loss of principal. Diversification and asset allocation does not ensure a profit or guarantee against loss. We provide this information with the understanding that we are not engaged in rendering legal, accounting, or tax services. We recommend that all investors seek out the services of competent professionals in any of the aforementioned areas.