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Does Financing Matter Once You're Dead?

Financing will matter to your family when you are no longer around.  All the hard work you put in for all those years has to go to someone. Planning an estate for when you die is the only way you can protect your family and loved ones.  Without a will, when you pass on, your loved ones might end up not being able to collect funds and or their inheritance.

To correctly plan an estate, there are a few things that you need to do, with the help of an attorney. You are going to need to write a will, appoint a power of attorney, appoint a health care proxy and even develop a trust if you so choose. The last will and testament will take care of dividing your possessions and property, while the power of attorney will give someone that you trust the ability to act on your behalf if you are no longer able to take care of things. The health care proxy is a person who will be able to act on your behalf during medical situations. A health care proxy has to be someone that you trust and know will fight for your best interest. Trusts help you to dictate exactly where and when your money will be released to those inheriting your assets.

Before you can start estate planning you need to be aware of your assets.  You should conduct an inventory on all goods, properties and monies. Your assets could cover everything from your pet to your retirement savings. 

Once you write a will and/or trust you need to sit down and discuss your decisions with your loved ones.  Hopefully by talking with them first, you will be able to have your desires understood and your wishes followed after death.

Until 2010 you can leave your heirs up to 3.5 million dollars tax-free. If a new law is not signed by 2011, this amount will change back to the originally planned one million dollar limit. On the other hand, you are allowed to give any one person up to $12,000 per year tax-free in gifts and $24,000 to a spouse as a trust. If you decide that your money should be spent on paying someone’s tuition or outstanding medical bills, those too, will be tax-free if given directly to the billing source. Another great place to give your assets after death is to a charitable fund or foundation. These donations grow tax-free and the gift can be appreciated before you die.

Death can be an unpleasant topic to think about, but it is something that everyone must face.  Take care of your business before that day happens and make sure that all is done the way that you intended it to be and your heirs will benefit from your planning.

For more information, contact your HCCUA Financial Advisor.

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