Financial Planning Post

The four critical areas to ensure a successful financial and estate plan

What do you need to be doing now to accomplish your retirement and legacy goals?

The idea of financial and estate planning is not often met with the same enthusiasm one may have planning their next vacation. While personal planning can seem like drudge work to many, it is vitally important. Unfortunately, too many people fail to plan and thus create unnecessary burdens for themselves and their loved ones. The following four items should be addressed in any successful financial and estate plan.
Planning is bringing the future into the present so that you can do something about it now. Alan Lakein

#1 Retirement

Retirement is one of the most important life events that many of us will ever experience. It takes proper planning and execution to ensure that your retirement will be successful. Have you thought about what retirement means to you personally? Do you know when you can afford to retire? A coordinated look at your overall financial picture as well as an understanding of your future income needs can help you put a plan in place that will ensure your long term financial security.

#2 Income

Key to understanding when you can retire is knowing what your future income needs will be and what assets will be available to meet those needs. Are you confident that your current assets will provide the needed income and that those assets will last as long as you need them to? The last thing that you want in retirement is to run out of money. These issues can be addressed with fewer headaches than you might think. It just takes a little planning and the proper preparation.

#3 Risk Management

We face personal and financial risks every day of our lives. A sound financial plan will identify, assess and prioritize the various risks that we face. It will then put in place a plan to mitigate these risks so that they don’t cause unnecessary financial harm to us and/or our loved ones. Several risks that we face include: dying too soon and leaving loved ones with financial burdens; becoming disabled and losing the ability to provide for

current and future income needs; being involved in a lawsuit that could put our financial independence at risk. Are you prepared for these and other risks? Do you have a plan in place that addresses issues or are you simply assuming that they won’t happen to you? Failure to prepare for these unexpected events can be devastating to you and your loves ones.

#4 Legacy

Is your estate plan in place and up to date? What will happen to your assets if something happens to you today? Will your assets pass the way you want them to and in the most tax efficient manner possible. Do you want to make certain that your families and loved ones are provided for adequately? These are very important questions to ask. In reality, everyone has an estate plan, whether they know it or not.

Those who die without planning will be subject to the intestacy laws of their state and their assets will pass to their loved ones according to those laws. However, most people want to control how their assets will pass and to whom they will pass when they are gone (and it is “when” and not “if”). However, estate planning is much more than that. It also includes passing your values in addition to your valuables, providing for loved ones with special needs, protecting your assets from irresponsible loved ones and future lawsuits, minimizing taxes, naming guardians for young children, providing for the transfer of your business, etc. Knowing you have a properly prepared plan in place will give you the peace of mind that your legacy will last long after you are gone.