One of the biggest financial decisions you can make is writing a will. You get to decide where all your money, property, and possessions will go and how after you die. Writing a will doesn’t always need the help of a financial advisor. In some cases, creating one is simple and a solicitor can give you all the help you need. But in other cases, a financial advisor comes in handy, especially when there’s a lot to consider. A financial advisor can be helpful with writing your will. The will writing process can get confusing and complicated, and everyone has a unique set of challenges.
A financial advisor will consider every aspect of will writing and estate planning. They will help you craft the perfect plan for your situation, assess every financial element, and guide you on legal issues to help you preserve your legacy.
Why You Need A Financial Advisor?
Even with the right legal advice, you may not know the best steps to take when writing a will. A financial advisor can play a huge role in creating goodwill. They will also ensure beneficiaries follow your wishes even after you’re gone.
Here are some ways a financial advisor might assist you in Making An Efficient Will.
1. Create a Wealth Transfer Plan
There are different options for transferring wealth to family members and loved ones. While some of them are effective, others come with challenges and pitfalls. It all depends on the type of assets you have, who you would like to choose as beneficiaries, and how you plan to pass the assets to them.
For instance, here are a few factors you would want to take into account:
- If you have minors, who will care for them and take care of their financial situation?
- What assets do you plan to pass on and to whom?
- Is there a plan for when and how your children will receive inheritances?
- Should you establish trust? If yes, what type of trust does your situation need?
- Does your estate plan involve your life insurance policy?
- Does your will say who inherits your possessions?
- Will you be giving some of your assets and estate to charity?
A financial advisor may not be responsible for drafting the legal documents, but they will help you know what options are best for you.
2. Consider Tax Implications
Since you can’t exclude taxes from estate planning and wealth transfer, a professional financial advisor will come in handy. A financial advisor will consider how taxes affected your personal finance, as well as how it affects your will. They will help you create an efficient plan to ensure your wealth gets to family members and chosen beneficiaries with minimum taxes.
There are many strategies for lowering inheritance tax. Your financial advisor’s job is to figure out the best approach to your unique circumstance and plan your estate.
3. Make Necessary Updates
As important life events unfold, the beneficiary specifications need to be updated. For instance, the death of a beneficiary, marriage, divorce, or growth of a minor will require changes. It’s the work of a financial advisor to make the necessary changes as time goes on. The advisor will consider short-term and long-term plans and will ensure that these plans suit your needs.
4. Create Charitable Inheritance
If you don’t have anyone specific in mind or place a high value on philanthropy, you can give your assets to charity. Giving to charity comes with its complications. With the help of a financial advisor, you can make sure he allocates your estate and assets according to your intentions. Your financial advisor will present you with all the options and create a plan to fit into your charitable legacy.
To Conclude
Without proper guidance, you could make many mistakes while planning your estate and writing your will. It’s easy for tax and legal issues to affect the allocation of assets according to your wishes. With the help of a financial advisor, you can get a reliable financial plan while you’re alive and create a secure financial life for your family and loved ones after your death.
Frequently Asked Questions
- How Often Should I Revisit My Financial Advisor?
Creating a will or an estate plan is hardly ever concluded. Whenever there’s a change in the way you feel about a plan, or a major life event unfolds, you should consider revisiting your financial advisor to make necessary adjustments.
- Should I Have a Financial Power of Attorney?
Yes. With a financial power of attorney, you can legally select someone you trust to handle your finances when you no longer can. Your financial advisor will guide you through proper documentation and the best person to choose to keep everything on track.
- What Do Financial Advisors Charge?
Fee-only advisors cost between $2,000 and $7,500 a year. Financial advisors who operate the Assets Under Management (AUM) charge between 0.25% and 1%. Some advisors have an hourly fee of $200 to $400 or a per-plan fee between $1,000 and $3,000.
