Retail Investors Can Benefit from Estate Planning | Millionaire Corner

Learn how retail investors can benefit from estate planning, a financial management strategy commonly used by Millionaires.

The majority of retail investors ? those with less than $100,000 in investable assets ? are overlooking an important aspect of financial planning - creating an estate plan.

?The mistake these folks are making is assuming that an estate must consist of millions of dollars. But, the truth is that nearly everyone has an ?estate? for purposes of estate planning,? attorney Michael Brennan blogs for the website Virtual Attorney.

A personal residence, insurance policies, retirement accounts, possessions and household goods are all components of an estate and can add up to sizable wealth, Brennan said. An estate plan can ensure these assets are divided in keeping with an investor?s wishes, and can help minimize the amount of taxes due on an estate. Planning can also provide for dependent children, direct end-of-life care and award power of attorney should an investor become incapable of managing his or her finances.

The benefits of estate planning are numerous, yet 56 percent of retail investors are going without an estate plan, according to a monthly survey conducted in March by Spectrem?s Millionaire Corner. In comparison, the share of investors foregoing an estate plan shrinks to 6 percent among individuals with $5 million of more in investable assets.

High net worth investors are particularly sensitive to changing tax and estate laws.

The issue of estate planning among ?ordinary middle-class couples? takes on additional urgency in the current environment of fiscal constraint and tax uncertainty, according to Brennan. Estate planning can have particularly significant tax benefits for surviving spouses and unmarried couples ? unable to use spousal exemptions - who can use trusts to remove assets from a taxable estate.

Learn more about the benefits of an irrevocable life insurance trust.

?There is a tendency to put off estate planning because death is something none of us likes to think about,? the law firm Godbey and Associates states on its website. ?Additionally,?crafting an estate plan can be a time-consuming and tedious task. The cost of a court battle after you have died, both in dollars and family anguish, are much greater that the cost of a basic estate plan. Don?t put it off any longer!?

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Source: http://www.millionairecorner.com/article/retail-investors-can-benefit-estate-planning

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