By: Janice Dantes
As a lawyer, I have served crazy rich Asians, crazy poor Asians, and just plain crazy (it all comes with being a family law attorney. What I have seen is that you do not need a crazy high salary to be crazy rich. Smart saving and making investments early is key. Once you have built your estate, make sure you start planning. Below are my pro tips for estate planning:
1. Make sure you know where all your money is. This seems like a no brainer, but sometimes people don’t realize that at their first job at McDonald’s when they were 16, they had a small Roth IRA started. Make sure you know where all your money is and make sure you have designated a beneficiary to avoid probate. Contact an estate planning attorney if you are considering putting the money in a trust.
2. Deal with the real estate. Real estate is a big headache when it comes to probate. If you are the sole owner, I would recommend either putting your house in trust or creating a transfer on death affidavit to avoid probate. This is particularly important for widows/widowers and divorced people who often become sole title holders of property.
3. Make sure you have a will and powers of attorney. Many people think that if you have a trust, you don’t need a will. In a perfect world, that may be true. However, we don’t live in a perfect world and humans make mistakes. The will serves as your backup in case property or assets were not put properly in the trust, or were completely forgotten about. Also, in a will, you can appoint a guardian for your children which is something you cannot do in a trust. No one knows how they are going to leave this world. Powers of attorney are a must to ensure that someone can make decisions on your behalf if you are incapacitated (e.g. car accident, disease, etc.).
4. See if a trust is right for you. People often come to me with questions about trusts. Trusts are great tools for estate planning. There are also different types of trusts that can be used for different purposes (e.g. living revocable trusts, special needs trusts, and land trusts). However, please keep in mind that you cannot use trusts to commit fraud or hide assets from the government to obtain benefits, particularly in retirement.
If you have questions about estate planning, please contact me at (312) 546-5077 or janice@pinaylaw. com.
Thank you for reading. Until we meet again, love one another.