Reviewing the estate plan

Doug Horn

Would you like a response to a financial question? Send your question to Doug Horn, 115 W. Broadway, Maryville, TN 37801. Be sure to mark your envelope Money Matters. Doug Horn, CFP, is an area financial planner with more than 24 years financial experience and founder of Quality Financial Concepts, located in downtown Maryville on Broadway.

The “Estate Plan” is often perceived as a massive set of documents for the wealthy. Clearly, estate plans are different for each family. Smaller plans will include documents for the husband and wife with each being only a few pages long. Other plans can be hundreds of pages long and very complex. Whether the plan is large or small, every family should have a current estate plan. Most financially minded people spend a great amount of their life time accumulating assets and planning for retirement, but more often than not, they spend little time addressing what will happen to those assets once they are disabled or deceased.

Most estate plans include a variety of documents which consist of a Will, Durable Power of Attorney for Health Care, Durable Power of Attorney for Property, Directive to Physicians, and some may include a variety of Trusts. Each document serves a specific purpose. These documents are needed in the event of a death or disability that prevents someone from managing their own affairs. Without these documents, prolonged and sometimes costly court proceedings are required in order to manage the financial affairs of the disabled or transition the assets of the deceased.

Estate planning can be crucial in preserving wealth that might otherwise suffer at the hands of taxation. A well structured estate plan can help minimize the amount of taxes placed upon inherited assets. Wealth can also be depleted once someone is disabled and in need of ongoing medical assistance, be it at home or in an assisted living facility. Unless assets are properly protected, they can quickly diminish with the rising cost of health care and the ever changing insurance industry.

Another unfortunate threat to hard earned assets is the misuse of those assets once someone becomes incapacitated. A good estate plan will allow important decisions to be made and honored by trustworthy and competent individuals versus those who may not have your best interest at heart.

The best estate plans are reviewed on a regular basis adjusting to life’s changes such as a divorce or any number of situations. It may become necessary to change beneficiaries, or in the case of a trust, a new trustee may need to be appointed. These tasks are often overlooked during emotional events in life but can be quite costly in years to come. Changes to an estate plan may also be necessary due to changes in federal and state laws and regulations. What started out as a good plan years ago could eventually become substandard if not regularly reviewed and/or modified.

A qualified estate planner will usually involve other professionals such as an estate or tax attorney in preparing the necessary documents such as wills and trusts. However, a true financial planner is the best resource in coordinating the plan in its entirety. An ongoing relationship with a financial planner is most beneficial when preparing for your future. With the advisor truly knowing you and your financial situation, he or she can advise you on matters you may have never considered and can develop a solid plan causing the least amount of conflict between you and your heirs. There are many options and ways to structure a plan, and the better the communication between the advisor and the client, the better the plan.

Regardless of whether you have a large or small net worth, an estate plan is most always beneficial. Assets are usually acquired through years of hard work, and no one wants their hard earned dollars depleted simply due to lack of planning.

For help with estate planning and managing investment assets, contact me at Quality Financial Concepts or one of the other Certified Financial Planners in our area. To continue a personal quest for education, you can also view our website, There you will find articles on a variety of topics, on-line seminars, calculators, as well as a host of other tools all available for free.

© 2009 All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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