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Why Estate Planning Is an Important Component of Financial Planning

An AmeriEstate agent sketching visuals to emphasize the significance of financial security.

When clients come to you seeking financial advice or wishing to establish a financial plan, their goal is likely growing their wealth. They might not understand that solid financial planning includes asset protection measures. Protecting their wealth ensures they maintain as high a level of security as possible now and in the future.

An estate plan provides added security, not just for your clients but also for their heirs. You may meet resistance from your clients if you suggest developing an estate plan. Let’s review some guidance you can give them about why estate planning is essential to a healthy financial plan.

Estate Planning Protects Their Assets After Passing

Your clients’ long-term financial goals should include what happens with their assets after they pass. They may assume they’re too young or don’t have enough wealth to worry about that. However, if they don’t establish a plan now, an unexpected accident may leave their assets hanging in probate limbo for years.

Estate planning includes establishing asset distribution, whether to familial heirs or charities. While a last will and testament stipulates who receives your clients’ assets after they pass, trusts provide heirs with additional protections.

A will does not prevent assets from entering probate. Probate is a lengthy and costly process, especially without a will in place. Establishing a trust protects your clients’ estates from entering probate. Additionally, trusts may offer a means for controlling tax liabilities, depending on how the trust is set up.

Estate planning also benefits clients with young children or children with disabilities. It allows for the arrangement of legal guardians to provide for them should both parents die before the children can care for themselves.

An Estate Plan Protects Your Clients’ Assets in Life

A living trust is a common element of an estate plan. It gives your clients control over their assets during their lifetime while establishing what happens to their estate after they pass. Living trusts give your clients the greatest freedom in asset distribution, as they maintain decision-making rights over their lifetimes and retain the right to make changes as they see fit.

Estate Plans Provide a Plan for Business Owners

Placing assets in a trust benefits business owners and their families. Without a trust, business creditors can pursue personal wealth to satisfy business debts. Their businesses will also avoid the probate process when your clients establish a living trust for their companies. Another aspect of estate planning for business owners is determining business succession plans.

Estate Planning Establishes Incapacity Care

With an estate plan, your clients can arrange financial and health care should they become temporarily or permanently incapacitated. The following protections are part of AmeriEstate’s living trust portfolio:

  • Financial power of attorney
  • Living will
  • Healthcare proxy
  • Long-term care directives

No matter how old your clients are, establishing incapacity care ensures their wishes are followed and bills paid if they cannot care for themselves.

AmeriEstate Estate Planning for Your Clients

As an AmeriEstate partner, you play a vital role in providing your clients with the information they need to protect their assets now and into the future. Make sure they understand the benefits of including estate planning as part of their financial plan. Feel free to contact us if you have any estate planning questions.

Sources:

https://www.fidelity.com/viewpoints/wealth-management/insights/trusts-and-taxes

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