Individuals who have a high net worth have a particular need for qualified estate planning. Complex asset portfolios require specific and strategic management. One of the most common errors that individuals make is simply not creating a comprehensive plan for their asset distribution in advance.
Here is some information to consider if you have a complex range of assets and are considering how to plan for your future asset distribution. There are several tools you can take advantage of as you envision how you would like to disperse your accumulated wealth after your death.
Estate planning and trusts
There are several crucial reasons that individuals with high net worth should accurately plan for their asset distribution. If you have heirs who stand to inherit the wealth you have accumulated, you need to plan for how it will pass to them. There are various ways to manage this. Trusts are a common tool that enables you to keep control over how you wish to distribute your wealth. You may wish to regulate the flow of your wealth to your adult child as well, to protect against inappropriate spending. Perhaps you wish to donate your assets to charity after your death, and in this case, a charitable trust may be an effective option for you.
A comprehensive plan
Estate planning encompasses many aspects of end-of-life decision making, beyond how you wish to distribute your assets. You should also consider how you would like decision-making on your behalf to take place, in the event you become incapacitated. Financial decisions, in this case, are particularly important. Part of a comprehensive estate plan can include aspects such as choosing a power of attorney to carry out your wishes and make decisions on your behalf if you are no longer able to do so. With high net worth individuals, simply having a will is usually not enough to ensure the appropriate distribution of assets and handling a complex financial portfolio.
You have worked hard to build up your wealth, so you must also put a plan in place to protect it. The first step is to speak with a qualified estate attorney who can assist you in evaluating your assets and your options to build a custom plan that best meets your needs.