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Customizing Your Estate Plan to Your Family’s Unique Needs Thumbnail

Customizing Your Estate Plan to Your Family’s Unique Needs

Like any other part of a comprehensive financial plan, there's no one-size-fits-all blueprint for an estate plan. Every person is different. Every family is different. And, as illustrated in a recent Wall Street Journal article, if you don't work with professionals to preserve your legacy, your way, you could be putting your estate, your loved ones, and your well-being at risk.

On today's show, we discuss a listener question about how to tailor an estate plan to specific family dynamics, the essential parts of an estate plan, and some of the legal options folks should discuss with their attorney and financial advisor.

Bigger than Beneficiaries

Perhaps the most common misconception about an estate plan is that you only need one if you're extremely wealthy. Some folks sitting on more modest nest eggs might think that as long as they've designated beneficiaries for banking, investment, and insurance accounts, they're covered.

But an estate plan isn't just about who gets what. It's a plan to protect both you and your assets in the event that you are unable to do so yourself. For example, naming someone to inherit your IRA when you pass away is important. But that doesn't do anything to ensure you get the care you want if you become incapacitated.

The estate plans we help folks put together at Keen Wealth include, at a minimum:

Last Will and Testament, which outlines your last wishes and explains how you want your estate to be distributed to your heirs and any other beneficiaries, such as charitable organizations.

Power of Attorney, which authorizes someone you trust to act on your behalf while you’re still alive if you are incapacitated or unable to make decisions. Be aware that your designee only has power of attorney while you are still alive.

Healthcare Directive, dictating how you would like to be cared for if you become incapacitated.

Living Will, which designates a person to be in charge of making important medical choices on your behalf if you are unable to. This person might use your healthcare directive as a guide, or you can explain the thought process you want your designee to go through to aid in their decision-making.

Living Trust for those who may have a more complex situation or wish to keep their situations private.

If you don't have these documents in place and you slip into a coma, your loved ones could face some impossible decisions about your health, your last wishes, and your assets. And if you do pass, the courts in your state of residence will have the final say.

Your Plan for Your Family

That brings us to today's question. Linda writes:

"I just read an article in the Wall Street Journal about estate planning and how surviving spouses have no obligation to stepchildren. My husband and I are each on our second marriage and have been so for 20 years, and each has adult children from our first marriage. We have gone through the estate planning process, but I am not sure that we have addressed this issue. What should we ask our estate planning attorney?"

In a sense, Linda's answer is in her question.

First, she and her current husband have an estate plan in place. That's a great start!

And second, as long as you and your spouse are still living and in good mental health, you can always talk to your attorney and your financial advisor to review, and if necessary, change what's in your estate plan. Linda and her husband can make whatever provisions they so choose to provide for the surviving spouse and children from both sides of the blended family.

Professionals can help you get as detailed and specific as possible about how your assets are dispersed. Whereas if you leave everything to a surviving spouse, or to "the good kid," you're essentially giving that one person total control over what happens to your estate. And you never know what's going to happen in a large family after you're gone. Maybe that heir is fair and equitable with the inheritance and the rest of your family. Or, maybe not.

The Next Five Years

Of course, getting lost in future scenarios is one of the reasons people put off estate planning in the first place.

That's why, at Keen Wealth, we counsel folks to think about what they would want to happen to their estates if they passed in the next five years. Focusing your thinking can help you arrive at more pragmatic and actionable solutions to protect yourself, your assets, and your loved ones in the here and now. For example, folks like Linda who have blended families might look into establishing trusts that set clear guidelines for how and when kids of various ages will inherit certain assets. A revocable trust is usually changeable until your death, so Linda and her husband could include reviewing that trust as part of their annual financial check-up.

Which is exactly how our process works at Keen Wealth. If you don't have an estate planning attorney, we can connect you with someone who will put your affairs in order. Once you have your plan, we'll incorporate it into our checklists for your overall comprehensive financial plan to make sure that we review your wishes and your beneficiaries for every single account and every single asset every single year. We can also discuss ways to use that estate plan to build a lasting legacy that could be so much more impactful on your loved ones and your community.

I understand that thinking about your passing isn’t pleasant. But I also know from experience that putting together a durable estate plan can provide a lot of confidence and peace of mind. Make an appointment to visit Keen Wealth and we can work together on an estate plan that’s ready to protect you now and adapt as needed throughout the rest of your life.

About Bill

Bill Keen is a financial advisor with over 30 years of industry experience. As the founder and CEO of Keen Wealth Advisors, a registered investment advisory firm, he focuses on providing personalized retirement planning designed to help people thrive before and during their retirement years. With a passion for educating others, Bill regularly blogs about retirement planning, hosts the podcast Keen on Retirement, and has contributed to Forbes, U.S. News and World Report, Reuters, Wall Street Journal’s Market Watch, Yahoo Finance, and other publications. Based in Overland Park, Kansas, Bill and his team work with clients throughout the greater Kansas City area and across the nation. To learn more, connect with him on LinkedIn or visit www.keenwealthadvisors.com.

KWMG, LLC’s dba Keen Wealth Advisors (“company”) is an SEC Registered Investment Advisor located in Overland Park, KS. The company and its representatives may only conduct business in those states where registered or where excluded/exempt or from licensure. For registration information please contact the SEC or the state securities regulators for the states where the company is notice filed. A copy of the company ADV is available upon request. Advisory services are only offered to clients or prospective clients where the company and its representatives are properly licensed or exempt from licensure. No advice may be rendered by the company unless a client service agreement is in place. This information is not intended to be investment advice or construed as a recommendation or endorsement of any particular investment or investment strategy and is for illustrative purposes only. Clients and prospective clients must consider all relevant risk factors involved with each strategy, including costs or fees, and their own personal financial situations before trading.

The views outlined in the book, Keen on Retirement Engineering the Second Half of Your Life, are those of the author and should not be construed as individualized or personalized investment advice. Any economic and/or performance information cited is historical and not indicative of future results. Economic forecasts set forth may not develop as predicted.

The Amazon Best Seller ranking listed on marketing materials is specifically referring to Best Seller rankings for the Kindle Top 100 Paid Lists under the subcategories of: Budgeting and Financial Risk Management, based on data as of September 5, 2019 and the second edition under Financial Risk Management on October 26, 2022. Amazon rankings although relevant on how a product is selling overall doesn’t necessarily indicate how well an item is selling among other similar items or similar item categories. Amazon may choose the most popular categories or subcategories within which an item has a high ranking to determine its best seller rankings. These rankings are updated hourly and as a result, should be expected to fluctuate as such. Keen Wealth Advisors and Amazon are not affiliated entities. 

The Steve Sanduski Advisor Network, Belay Advisor, LLC and other third-party contributors to our blogs and podcasts are not affiliated with Keen Wealth Advisors.

For additional details on Keen Wealth Advisors, please visit https://www.keenwealthadvisors.com/important-disclosures.


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