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6 Basic Steps to Legacy Planning

Author: Ryan Mason
June, 2016 Issue

What long-term impact do you wish to leave to the people and causes that are important to you? Legacy questions are tough, and estate planning—an essential part of documenting your intentions—can be complex. One way to get the process started is to consider these basic steps.

An updated will. Your will is a legal document that spells out your wishes about who will inherit specific assets after your death. A properly drafted will plays a critical role in minimizing your estate’s exposure to taxes. If you should die without a legally binding will in place, courts may end up making decisions about who benefits from your estate, regardless of your best intentions. Be sure to review your will regularly.

Owned property. If you’re married and own property you intend to gift, check state laws to see how regulations may affect your estate. In some states, property owned prior to marriage can be treated as separate property belonging to just one spouse. In other states, called “Community Property” states, all property acquired prior to or during marriage is considered owned by both spouses. Review your property and make sure it’s set up within your estate to benefit your chosen recipient(s).

Beneficiary statements. Review your beneficiary designations and make sure they align with your wishes. Check your beneficiaries for retirement plans (such as a 401(k) or a 403(b)s), IRAs, bank accounts and insurance policies. Keep in mind that beneficiaries you name on these accounts take precedence over those named in a will. It is important to regularly review beneficiaries, particularly after major life changes such as marriage, divorce or the birth of children or grandchildren.

Health care directive and living will. No matter your age, it’s important to be prepared for unexpected turns in your health, either through accident, illness or other reasons. This includes having a health care directive that provides guidance on the extent of the medical treatment you wish to receive based on your condition. Check with your doctor or other health care providers to make sure they’re agreeable with the terms you intend to include.

Power of attorney. You should consider empowering an individual to make decisions on your behalf if circumstances arise that prevent you from doing so. Designating a person to be a “durable” power of attorney means they can act as your agent, making medical and/or financial decisions for you when needed.

Digital accounts. A new concern is to make sure loved ones know how to find all required information, including passwords, to access your online accounts. This may include financial accounts, household accounts (energy, cell phone and cable company, for example) as well as social media accounts.

Be sure to consult with an attorney for assistance in creating the necessary documentation for your estate plan. Your financial advisor can review your estate goals to assure that your legacy intentions are consistent with your overall financial strategy.

Ryan Mason is a financial advisor with Strategic Planning & Investment Advisors, located at 1101 College Avenue #140, Santa Rosa, a financial advisory practice of Amerprise Financial Services, Inc. He offers fee-based financial planning and asset management strategies and has been in practice for 15 years. Contact him at (707) 385-8400.

Investment advisory products and services are made available through Ameriprise Financial Services, Inc., a registered investment adviser. Ameriprise Financial and its affiliates do not offer tax or legal advice. Consumers should consult with their tax advisor or attorney regarding their specific situation.

Ameriprise Financial Services, Inc. Member FINRA and SIPC

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