There are certain things to take into consideration when creating an estate plan. The first step Colorado residents who are thinking about estate planning need to do is to take stock of their financial net worth. That means do a calculation of everything of value such as bank accounts, investments, retirement plans, insurance plans, real estate, stocks, bonds and personal property worth a significant amount. Then, one needs to deduct from the values liabilities such as credit card debt, loans, mortgages and the like.
A net worth will show if a testator’s estate is on the line for any federal estate taxes. Even if an estate isn’t liable for federal tax, it could be for state or, in some states, inheritance taxes (Colorado does not impose an inheritance tax). There are financial reasons other than taxes to have a comprehensive estate plan in place, especially for those who own businesses. An estate plan can also speak to what should happen if the estate owner becomes incapacitated.
What about a trust?
An experienced attorney would be able to offer advice on whether a testator should incorporate a revocable living trust into his or her estate plan. There are pros and cons to using trusts, depending upon a testator’s personal circumstances. It is wise to have information regarding the various kinds of trust that might be used and what they mean.
Estate planning can be rather complicated to do without the help of someone experienced in the legalities. Making wise choices can mean much less stress for loved ones when the time comes. A Colorado lawyer experienced in estate planning may mean the difference between someone having a mediocre estate plan and one that is complete and legally binding.