John Shimp, CFP©, CRPC©, CFS©, CDFA™, APMA, CLTC is a Private Wealth Advisor and Managing Partner with RidgePoint Financial Partners™, a private wealth advisory practice of Ameriprise Financial Services, Inc. in Langhorne and Limerick, PA. He offers fee-based financial planning and asset management strategies and has been in practice for over 15 years.
Estate planning can be a tough and emotional conversation to initiate with your loved ones. But it may not be as challenging as you think. Recent research from Ameriprise Financial confirms that families who have had the conversation say it went better than they expected. In the Ameriprise Family Wealth Checkup study, families said their discussions were straightforward and open, rather than difficult or awkward, giving you more motivation to communicate with your loved ones1. The following steps can help you get started planning your legacy:
Take Care of Basic Legal Matters
A key to having your affairs in order is to take time to create or update your estate plan, which encompasses anything you own, such as real estate, cars, life insurance, financial accounts including your retirement plans, personal possessions, as well as your online assets and accounts. An estate plan documents your wishes for what happens to these assets and accounts in the event of your death. Estate plans commonly include the following pieces:
- A current will stating how you’d like your assets distributed. If you have minor children, a will allows you to nominate a guardian to care for your children.
- Trust documents, if establishing a trust to hold your assets is appropriate for your circumstances.
- A health care directive that outlines your desires related to medical treatment.
- A plan to cover legal fees, taxes, funeral costs and final medical expenses.
Creating an estate plan can be challenging, depending on the complexity of your situation. An attorney, financial advisor and estate planner can help you establish a plan that works for you, no matter the size of your estate.
Put Proper Protection in Place
Purchasing life insurance when you are younger has significant advantages. Premiums tend to be lower, so choosing a death benefit that can be sufficient to meet your family’s needs is realistic. Developing an insurance plan will help you determine an appropriate level of coverage to suit your needs. If you already have life insurance, review your coverage with a financial professional to make certain you have the right kind – and amount – of protection in place.
Know Where Your Investments Stand
Make sure that you (and your spouse if you’re married) have clear financial goals and know your progress toward achieving them. While your portfolio is likely set up to achieve longer-term goals, make sure you have the appropriate number of assets in shorter-term liquid investments that you or your loved ones can access quickly if an unexpected event occurs. And finally, review the beneficiary designations on your accounts to ensure they are up-to-date.
As you continue to plan for a good, long life, be sure to devote a modest amount of time to make sure your legacy is well protected.
1 – The Family Wealth Checkup study was created by Ameriprise Financial, Inc. and conducted online by Artemis Strategy Group November 23 – December 15, 2016 among 2,700 U.S. adults between the ages of 25-70 with at least $25,000 in investable assets. For further information and details about the study, including verification of data that may not be published as part of this report, please contact Ameriprise Financial or go to Ameriprise.com/familywealth.
Before you purchase insurance, be sure to consider the policy’s features, benefits and fees, and whether it is appropriate for you, based on your financial situation and objectives.
Ameriprise Financial, Inc. and its affiliates do not offer tax or legal advice. Consumers should consult with their tax advisor or attorney regarding their specific situation.
Investment advisory products and services are made available through Ameriprise Financial Services, Inc., a registered investment adviser.