Estate Planning And Your Will

When planning your estate for your retirement

, you need to create a solid will to ensure that your beneficiaries receive your assets properly when you pass on. If you don't create a will that correctly designates your beneficiaries, the state will manage your assets for distribution. Here's what could happen should the state split up your estate for you:

If your husband or wife passes on right after you do, a simultaneous death clause will give your estate to your offspring. Half or a third of your estate will go to your surviving spouse, even if a smaller share is specified in your will.

Children from a previous marriage won't get anything from your estate if you leave all of it to your current partner. Bypass trusts can give a surviving spouse regular income until he or she dies, after which the children will get their designated assets.

Make sure that the beneficiaries designated in your life insurance and retirement accounts are constantly updated so these assets won't become part of the will. 401K, for example, will pass on the payout to the surviving husband or wife unless he or she signed a waiver.

Spendthrift or testamentary trusts in your will can control how and when assets are distributed, so beneficiaries can't spend it quickly. You don't have to tie in bequests to the behavior of your heir/s because of this type of trust.

Giving away your assets while you're still alive is one option you can consider to simplify your will. You can transfer ownership to a trust or hold these assets in joint tenancy. Annually, you can distribute up to $13,000 to many people, or pay for educational and medical costs straight to the provider without having to worry about federal tax.

Retirement planning should include the proper designation of beneficiaries in your will so your assets are distributed as you specified before you pass on. If you don't establish these beneficiaries in your will, unwanted asset distribution can occur. Contact your lawyer or financial planner to help you review your will, especially when major changes to your life occur.

by: Carina Smith

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