Why is Estate Planning an Essential Aspect of Financial

Sharan Lee Levine

Estate planning is an essential aspect of financial management both from a personal and business perspective.  On a personal level, a current Will, Trust (if necessary), Durable Power of Attorney, and the Health Care Directive, and letter of instruction are components among other ancillary documents.  Informing your loved ones of your intentions- and making clear your instructions alleviates much angst and difficulties for a family in the event of a sudden and tragic event.  Even if you become ill and require assistance, planning when you feel well and can clearly identify your needs and your family’s needs are of the utmost importance.  Making clear how they can locate your assets, debts, how they can pay bills, collect on debts, is required; many persons conduct nearly all their banking and bill paying online; do your loved ones or assigned representatives to know where to find passwords and what needs to be taken care of?

Confirming your beneficiary designations on life insurance policies, retirement plans is also an essential financial strategy; have both the primary beneficiary and the contingent beneficiaries been identified? 

Financial management might mean that you need to provide for beneficiaries with special kinds of money management issues, or, in the alternative, perhaps you have charitable intent.  

Not only do all of us need to consider what happens with our assets at death; what happens in the event that you become disabled and unable to manage your own affairs?  In this event, depending on your assets, making sure you have a current Durable Power of Attorney and successor trustees identified in a trust instrument, is one of the most important keys to managing finances. 

From a business perspective, in addition to all of the issues outlined, your business plan should include an integrated plan with your estate needs.  Who will run and manage your business in the event of your death and/or disability?  Providing for leadership to continue after death and disability is required for sound financial management.

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