You are currently viewing How To Successfully Plan Your Estate: A Definitive Guide to Succession Planning
Succession Planning

How To Successfully Plan Your Estate: A Definitive Guide to Succession Planning

Succession Planning – Who Needs to Be Involved in Estate Planning?

To have a well-drafted estate plan, it is important to include all the necessary individuals.

The following people need to be involved: the individual that holds the estate, the individual’s spouse or partner, any children of the individual, and any other individuals who may be financially dependent on the individual.

Each person’s situation is unique and will require different provisions in the estate plan.

For example, a parent with young children will want to name a guardian to care for their children if something happens to them.

An unmarried adult without children may want to name a trusted friend or relative to manage their affairs if they become incapacitated.

It is important to remember that everyone should have an estate plan, not just those with significant assets.

Even if you do not have accumulated wealth or multiple properties, you still need an estate plan in case something happens to you, and your loved ones need to step in and manage your affairs.

When Is the Right Time to Start Thinking About Estate Planning?

Estate planning is an important task that every adult should complete, but it can be difficult to know when the right time is to start.

For most people, the process of creating an estate plan is delayed until later in life, when they have accumulated more assets and need to consider how they will be distributed after their death.

However, this approach can cause problems if unexpected events occur, such as an illness or injury.

Financial consultants typically recommend that adults start considering estate planning as soon as they reach legal adulthood.

This gives them time to create a comprehensive plan (succession planning) that considers their unique circumstances.

It also allows them to revise their plan every 3 to 5 years, as their needs and desires change.

By starting early, individuals can ensure that their estate is managed according to their wishes.

Things To Consider When Creating Your Succession Planning

Regarding estate planning, there are many things to consider.

But one of the most important aspects is ensuring your loved ones will be taken care of when you pass away. That is where succession planning comes in.

Here are some key things to consider when creating your succession planning:

  1. Choose Your Executor

The executor is responsible for carrying out the terms of your will and ensuring that your estate is distributed according to your wishes.

It is important to choose someone you trust who is capable of handling this responsibility.

  • Outline Your Wishes

Your will should specify how you want your estate divided among your loved ones.

You may also want to designate specific gifts or donations to charity.

  • Consider Tax Implications

When creating succession planning, there are several tax implications, so it is important to speak with an accountant or lawyer about them.

For example, you will need to decide whether you want your estate taxed as an individual or corporate income.

  • Plan for Minors

If you have minor children, you will need to make arrangements for their care and support after you’re gone. This could include naming a guardian in your will or setting up a trust fund.

  • Plan For Disability or Incapacity

If you become disabled or unable to manage your affairs, you will need to have a plan for who will take over your estate.

This could include appointing a power of attorney or setting up a trust fund.

How To Choose the Right Executor for Your Estate

There are key factors to consider when choosing an executor for your estate.

An executor is responsible for ensuring that your estate is settled according to your wishes, and this can be a complex process.

These are important things to keep in mind when making your decision:

  1. Choose Someone You Trust

The most important factor in choosing an executor is trust.

You need to know that your executor will act in your best interests and carry out your wishes faithfully.

This person will have control over your estate, so choosing someone you can rely on is important.

  • Consider The Individual’s Experience and Skills

An executor should be someone who has the experience and skills necessary to manage the complex tasks involved in settling an estate.

They should be organized, and efficient, and should be able to handle the paperwork and financial matters competently.

  • Is The Individual Available and Willing to Take on The Role?

An executor should be available and willing to take on the responsibility of handling your estate.

They should also be able to manage the time commitment involved, which can be significant depending on the size of your estate.

  • Consider The Individual’s Age and Health

It is important to choose an executor who is healthy and capable of performing the duties of the role.

If the individual is elderly or has health concerns, they may not be able to oversee all the responsibilities involved.

  • Consider Other Factors

Other factors may be important to you when choosing an executor, such as whether the person lives close by or has experience in a certain area of law.

Think about what is important to you and make a list of priorities before making your final decision.

What Happens If You Don’t Have an Estate Plan in Place

Without succession planning, your loved ones may go through a lengthy and difficult probate process after you pass away.

Probate is the legal process of distributing your assets and settling your debts.

If you die without a will or other estate planning documents, the court will appoint an administrator to manage your estate.

This can be time-consuming and expensive and may not be what you would have wanted for your loved ones.

In the meantime, your assets and accounts may be frozen leaving your dependents in distress.

In addition, without a succession plan, your assets may not be distributed in accordance with your wishes.

For example, if you have minor children, you may want to designate a guardian for them in your will.

The court will decide who will raise your children if you do not have a will.

Succession planning can help ensure that your loved ones are taken care of in the way you want.

Final Thoughts

Estate planning and wealth planning are crucial to ensuring that your wishes are carried out after you die or become incapacitated.

While it may seem daunting, estate planning can be simple if you take the time to understand your options and choose the right people to help you. With a little bit of planning, you can rest assured knowing that your loved ones will be taken care of and that your affairs will be handled according to your wishes.

Please contact us if you have any questions about succession planning or would like help creating an estate plan. We would be happy to assist you.

If you are interested in reading more about us, access our blog.

Keeping it in the family

The Importance of Family Offices for wealth management

The Family Deed….a starring role

Family Offices & Succession planning: Responsibilities and Risks

4 aspects of How to Protect your loved ones against unforeseen events

5 Best practices to safeguard your legacy

Choosing an advisor for wealth management

Estate planning process vs COVID-19

We invite you to subscribe to our Youtube channel, where you can find videos on topics of interest in corporate and fiduciary matters, among others.

For more information about this topic or any additional detail on OMC Group products and services, please complete the below form: