Fairfax, VA (Law Firm Newswire) September 21, 2016 – It is important that those individuals and families with estate planning documents comprehend the difference between possessing such documents and having a wealth transfer plan.
Without an estate plan in place, the state in which the decedent lived will decide who is entitled to inherit the decedent’s assets. And the decision of the state may not be in accordance with the wishes of the decedent. An estate plan can help expedite the transfer of assets to the beneficiaries, reduce attorneys’ and court costs, and maintain peace within the family.
A wealth transfer plan consists of a number of decisions made and actions taken by the testator in order to prepare the heirs for their inheritance, and enable them to make more suitable choices about their bequests. An effective transfer plan consists of the communication of the testator’s values regarding money, and objectives with respect to family. It also addresses the sharing of plans regarding heirs or beneficiaries, and the time at which the transfers will occur. In addition, it involves the introduction of family members to the testator’s advisers, including a lawyer, tax adviser and certified financial planner.
Prominent Vienna, Virginia estate planning attorney Lisa McDevitt states, “Individuals and families are advised to discuss with their estate planning attorney the option of creating a wealth transfer plan so as to preserve family wealth and minimize the potential for loss of assets.”
Moreover, a wealth transfer plan aims to encourage a more thorough understanding by the heirs of the assets within the family, and to inspire them to have a better comprehension of investing. It also informs them of the various choices for transferring wealth, such as direct gifts and trusts. When family members create their own estate planning documents, heirs will be in a better position to accept their inheritance.
Reasons that a testator might wish to transfer assets during the testator’s lifetime include:
* prevention of use of the assets to cover the costs of long-term care
* avoidance of inheritance taxes
Without a wealth transfer plan, there is likely to be a loss of family wealth over time. This is often due to a lack of communication, understanding and trust among family members. Such a loss can also occur because heirs are unprepared to accept their inheritance. Another reason involves inappropriate investing and mistakes in financial and tax planning.
Lisa Lane McDevitt
2155 Bonaventure Drive
Vienna, VA 22181