Due to recent economic downturns, many people are reconsidering their estate plans. Thoughts about future financial security and physical health risks are on every asset owner’s mind. Having your estate-related affairs and plans in order is vital in this current economic climate. However, not all asset owners are aware of the risks of not having well-detailed estate plans.

According to a recent report, many asset owners are currently overlooking the basics of income and estate tax planning. They’re focusing more on issues like –

  • Proposed tax law changes.
  • Proposed capital gains tax law changes.
  • The general economic uncertainty because of the pandemic.
  • The threat of hyperinflation.

Although reviewing these aspects of financial management is fine, investing time and resources in long-term estate planning is more important. Here’s why.

Understanding the Importance of Estate Planning in the Post-Pandemic Era

Estate planning is the process of protecting your control over your assets during your lifetime. It also involves the transfer of assets to your recommended beneficiaries if you become disabled or pass away. Your estate plans will dictate how your assets will be dispersed and protected once you’ve passed.

Anyone planning to hand over assets/liabilities like homes, stocks, or debt to future generations should invest in estate planning. People who have well-defined estate plans can freely enjoy their lives. Even if they’re mentally/physically unable to make independent financial decisions, their estate plans give them financial security and comfort.

Who Needs Estate Planning?

Contrary to popular belief, anyone (not just the super-wealthy) can benefit from high-quality estate planning services. People with both high-value or low-value assets can benefit from setting down proper instructions regarding how their assets are managed.

  • People with high-value assets can benefit from estate planning by securing the right tax deductions, gaining from asset conservations, etc.
  • People with low-value assets or low net worth can set up debt repayment plans or asset distribution plans in their estate plans.

What Happens During Estate Planning?

Estate planning processes are long. Accountants take into consideration every requirement and objective of their clients. Once the plans are complete, one thing is for certain – there won’t be any misunderstandings regarding the estate owner’s assets. Accountants also use their effective tax planning skills to conserve as much value as possible for their clients.

Estate planning processes involve –

  • Property Management Guidelines: Once the estate owner passes away, who will manage their properties and how? Accountants list all the assets owned by the estate holder. Then they match the assets to the list of all the beneficiaries who will receive those assets. By setting these property management guidelines, accountants avoid future confusion.
  • Designating Beneficiaries: Estate owners can designate beneficiaries in their estate plans. That includes – people who will take care of their assets, their children and manage their healthcare decisions.  
  • Asset Distribution: Who will receive the estate owner’s assets after their death? How will they be divided among sub-beneficiaries? Accountants clarify all these details during estate planning.

Some other tasks involved in estate planning processes include – pre-organizing funeral arrangements, reviewing outstanding loans, and the creation of wills.

How Can Accountants Help with Estate Planning?

The best accounting companies near me employ more than just “tax experts” or “statisticians.” They employ financial partners who share their clients’ objectives. In estate planning processes, accountants help their clients by –

  • Defining their short and long-term estate planning goals.
  • Setting up an estate planning team to review the client’s debts, assets, outstanding payments, tax obligations, etc.
  • Setting up the plans by creating wills, trusts, and other legal estate planning documents.
  • Make sure the clients pay as little tax as possible at the time of their deaths.
  • Oversee asset distribution processes in the fairest way possible.
  • Educating the beneficiaries about the assets or debts they receive.

Estate planners are accountants who have intimate knowledge of their client’s financial affairs. Their secure and timely services ensure that their clients leave the earth in the most peaceful way possible!