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Are You Up-to-Date on Your Estate Planning Needs?

January 16, 2019
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While it can be a difficult topic to discuss, deciding what will happen to your assets after you pass away is important. No matter the size of the estate, you should have a plan in place to ensure your wishes are fulfilled and ensure that your family, property and obligations are taken care of.

According to a recent study from BMO Wealth Management, 52% of U.S. adults have not made a will, 40% of parents haven't talked to family about their estate planning needs, and only 28% of those surveyed have an understanding of their parent's legacy wishes. 

So, why do we procrastinate or avoid the topic altogether? First, it can be a hard topic to approach with family members. Second, many people perceive estate planning to be a daunting process. And third, you may not think an estate plan is something you need. But, putting plans in place for what will happen to your assets will give you and your loved ones peace of mind. 

While some estates are vast and complex, most estates are smaller and relatively simple to manage if there's sufficient time, planning and communication involved.

Let's start with the basics.

1. Take an inventory of your assets and liabilities. 
Make sure you have a solid understanding of everything you have to give so you can make smarter planning decisions as to how (and when) to give it. Assets are things like your home, bank accounts, or personal property. Examples of liabilities are your mortgage, credit cards, and other debts. 

2. Identify who is who.
Determine who you want as your beneficiaries and how much and in what manner they should receive assets. You also need to identify someone you trust who has the ability to effectively implement your plans as executor or as your healthcare power of attorney. 

3. Create a will. 
Even the smallest of estates can benefit from having a will. A will can minimize uncertainty or misappropriation of assets. Depending on your assets, you may also need to consider other options, such as a revocable trust, which can be especially beneficial if you own real estate or property in several states. 

4. Update beneficiary designations on all accounts, especially retirement accounts and insurance policies. 
Relationships change throughout our lives. Babies are born, marriages take place, and death and divorce can occur. If you don't routinely review and update your beneficiaries, your assets may not be distributed according to your wishes. In addition, asset distribution can become overly complicated if the beneficiaries in your will don't match the names listed on your accounts.

5. Verify your executor and powers of attorney. 
Once you're unable to speak for yourself, it is too late to change designations. Just like the need to update beneficiaries, it's important to make sure the people you've designated as your executor(s) or powers of attorney are still the best people for those responsibilities.

6. Use the right advisers to help you implement your plan. 
Depending on the size and complexity of your estate, planning does not need to be expensive. But, it is important to get professional advice to ensure you're considering everything and making the wisest decisions. Make an effort to put your wishes in writing. Verbal promises and conversations hold little to no weight in the court of law. If it's important enough to plan for, it's important enough to write it down. 

While these reminders may sound like no-brainers, don't make the mistake of confusing simple with unimportant. Not following these basic steps can make the difference between your estate being handled exactly as you wish vs. it winding up in the hands of the court with some very unpredictable results. 

Watch this short video for more information on estate planning. 

The information and recommendations contained herein is compiled from sources deemed reliable but is not represented to be accurate or complete. In providing this information, neither Cortland Bank or its affiliates are acting as your agent or is offering you any tax, accounting or legal advice.

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