If you have considered the firm that will provide you the best will and trust attorney for your estate planning services, the next step must be listing the beneficiaries and know what specific options you can give them.

List Down Your Beneficiaries

In legal terms, the beneficiary is referred to as someone who will inherit your assets irrespective of whether it has a beneficiary designation or not. It is also known by the term ‘heir.’ You must make a list of your beneficiaries to ensure that you include everyone you want and make the assets distribution process easier. You must contact an asset protection attorney for the best planning strategy of your assets for your beneficiaries.

Giving Your Beneficiaries Now

If you want to give them now, you will enjoy savings as gifts to family and friends that are not tax-deductible. You can help your children or family members financially by reducing your estate taxes and federal gifts during your lifetime.

  1. Utilizing The Annual Gift Tax Exemption: Substantially, you can reduce the estate value by taking advantage of the ability to give gifts to a certain limit to as many people as you want. Moreover, you will notice that lifetime gift tax can apply.
  2. Pay For Your Beneficiaries Medical Expenses And Education: You can plan to provide tuition fees for your grandkid or any other loved student in your life. You can simply write a check to the institution to avoid generation-skipping transfer tax and gift tax. The same goes for medical expenses. Also, paying for such things is considered non-taxable.
  3. Use Annual Gift Tax Exemption To Fund Your Kid/Grandchild’s College Education: You can use the annual gift tax exemption to make a Uniform Transfers to Minors Act (UTMA) account, or Uniform Gifts to Minors Act (UGMA) account, or 529 accounts sponsored by the state. These 529 plans can include some unique features, which can be worth up to five years of annual gift tax exclusion amount getting added to the account in the first year. However, this feature is applicable only if you agree not to make another gift to the same person in the subsequent four years. In addition to education, UGMAs and UTMAs can also be used for other expenses.
  4. Investment In Child’s Retirement Plan: One of the best ways to utilize your annual gift tax exclusion is by providing help to a child, grandchild, or anyone under the age of 18. You can invest for their future by creating and investing in a Roth IRA for children or minors.

Even if the assets in the account become the property of the minor or owner of the account, it is maintained with control over by an adult custodian.

These contributions are specifically made to benefit the minor, who must get an income equal to or higher than the total contribution amount to the minor’s account. Nowadays, the Roth IRA for Kids has become a great solution to boost savings for retirement from a young age.

 Know-How To Transfer Assets To Your Beneficiaries

You must take the help of the asset protection lawyer to find out the specific rules and options for each loved one to whom you will leave assets.

  1. For Children: If there are any children from a previous marriage or minor children, they will need special considerations.
  2. For Spouse: After marriage, your spouse becomes the joint owner of your assets. However, certain provisions enable faster and direct transfer.
  3. For Grandchildren: If you make a proper estate plan for your grandkids individually, they will enjoy the benefits as an adult or minor.
  4. Other Family And Friends: At times, the settlor can leave the assets to the relatives or friends instead of spouses and children. In such cases, the assets can most likely undergo probate.
  5. Charity: Charity helps the trust to distribute either the entire asset or a fixed percentage of the assets to any charitable organization of his choice. This can benefit in terms of tax strategy and favorite causes.

Considering Insurance

Several people have life insurance nowadays. If you don’t, it may be the right time to consider how it is beneficial for your estate plan strategy.

  • Life insurance may offer death benefits to provide aid for expenses, and it can also be used as a great tool for wealth transfer.
  • This death benefit can significantly help your beneficiaries to deal with final expenses, live up to their standard of living for the years to come, only if you plan the coverage wisely.
  • Insurance can also benefit your beneficiary to ensure that their business or plans like college education stays on track.
  • Long-term care insurance is another consideration by people for beneficiaries. In cases of unexpected incapacitation, LTC insurance will act as your source of funds to help with care and avail more options for your beneficiaries.

Ending Note

You must hire the best estate planning lawyer to make the best strategies for your beneficiaries. You can also consider insurance as an option for your loved ones.