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Estate Planning Tips: How to Protect Family Assets

Are you worried about your finances and your family’s future? There are proactive steps you can take today to protect your assets and your loved ones. By creating a comprehensive estate plan, you can ensure that your family’s assets and your loved ones are protected in the event that you become incapacitated or pass away. You can also set up tools that protect inherited assets for your children and grandchildren from divorce, lawsuits and future estate taxes. 

The current health crisis has severely impacted families who did not take proactive steps to help their loved ones. To ensure your family is protected, our team at Gilfix & La Poll Associates LLP has put together tips to help you understand the first steps of estate planning.

Discover how to protect your family assets in our webinar below.

The “Big Four” Estate Planning Documents

There are at least four essential documents every individual should have in their estate plan.

  1. Revocable Living Trust: Trusts are established to provide legal protection for the trustor's assets and to make sure those assets are distributed accordingly. Trusts can also reduce paperwork and help you avoid inheritance or estate taxes. A living trust is a type of trust that operates while the grantor is still alive. A revocable trust gives you, as the grantor, the flexibility to change the terms of the trust and to end the trust at any time.

  2. Durable Power of Attorney for Finances: A durable power of attorney is beneficial because it gives legal authorization to the person of your choice to act on your behalf if you become ill or disabled and cannot act personally. This means that if you were to become incapacitated, the designated power of attorney can sign financial documents on your behalf.

  3. Advance Health Care Directive: An advance health care directive allows your family and health care providers to know your preferences in the event that you become incapacitated and are unable to speak for yourself. Whether this results from old age, a disease, or severe injury, having an advanced health care directive will allow your loved ones to make decisions according to your wishes.

  4. Family Protection Trust (FPT): The FPT is a long-term irrevocable trust (generically known as a "dynasty trust") that can benefit your children, grandchildren, and future generations. It provides extraordinary protections of assets for future generations, including protection against divorce, lawsuits, and future estate taxes. A type of "prenuptial agreement" for your children and grandchildren.

What If I Already Have a Trust or Estate Plan?

Even if you already have a trust in place, it is vital that you continually get your estate plan reviewed by an experienced estate planning attorney. You should review your estate plan at least once every three years or after a major life event, such as the birth of a child, grandchild, estate tax law changes, and more. Updating the structure of you living trust can save your family $100s of thousands of dollars, or more, in taxes. 

If you want to learn more about estate planning and protecting your dynasty, contact our Palo Alto estate planning attorneys today at (650) 683-9200!

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