Estate planning is not a one-size-fits-all proposition for Minnesota residents. There are a number of factors that make the process unique for each individual, and one of them is whether or not the person has children. In cases where a person is making an estate plan and has children, he or she will commonly make a number of bequests to the children and in some cases will name one of the kids as executor of the will. In cases where the person does not have children, the decisions might be more difficult, but the estate planning process is just as important.
Minnesota residents who have not looked over their estate plan for a few years should do so. Estate plans should be reviewed about every three years, but there are also certain situations that should require a review even if less time has passed.
While many people in Minnesota may be fans of Stan Lee's comic book art and creative work, they may not want to emulate his estate planning choices. The 95-year-old man passed away in November 2018, survived by his 68-year-old daughter. In 2017, his wife of 70 years passed away, and earlier in the year, he reported that $1.4 million was missing from his savings. Lee has also admitted that he had untrustworthy financial planners early in his career.
Many people in Minnesota work hard to draw up their estate plans. They think long about the way they want to divide their assets and work with lawyers to draft, complete and execute the necessary documents. Still, even after signing off on wills, trusts and powers of attorney, there are some important follow-up steps that estate owners can take to make sure their plans are protected.
Estate planning is rarely a high priority for young people in Minnesota and around the country, and studies reveal that three in four American millennials have not drafted a last will and testament. This can be a delicate subject even for those who expect to live for several more decades, but financial experts say that there are good reasons for even young adults to put at least a rudimentary estate plan into place.
There are a number of ways that Minnesota parents can use estate planning documents to make sure their children are cared for in the future. In fact, estate planning is perhaps most critical for people who are also parents. By creating key documents like wills, trusts and powers of attorney, people can direct how their assets will be distributed, especially in the interests of caring for their children. Trusts in particular can help people pass on wealth to minor children and continue to exercise some level of control over how the funds are used.
There is a potential "time bomb" hidden in some estate plans in Minnesota. Specifically, a possible source of unexpected problems is the individual named to act on behalf of the person making the estate plan. Actions taken by one or more parties named to oversee an estate could trigger family conflicts or affect the financial security of future generations. Some issues might be avoided or minimized when more thought is given to selecting estate plan surrogates.
Trusts are an important part of estate and financial planning for many people in Minnesota. The current interest rates can play a major role in determining which type of trust will be the most beneficial to heirs. After years of lower rates, interest rates are rising, and this trend is expected to continue into the future. As the rates change, the decisions that estate owners make about trusts can also change.
There are many reasons why a Minnesota resident with a trust-based estate plan may fail to place their assets into the trust during their lifetime. However, if there is no other will that dictates what should happen to the assets, the inclusion of a pour-over will can ensure that the assets are passed to the trust when the grantor dies.
Trusts may be an excellent tool for some people in Minnesota who are creating an estate plan. They are designed to provide a number of benefits including the ability to pass assets such as IRAs on to beneficiaries in a way that will defer or avoid taxes while growing in value. They may also be used to specify how distributions will be made. For example, distributions might only happen when beneficiaries reach certain ages or other milestones. Trusts can also express a goal, such as saving for a grandchild's education.