Stewardship is the good care of what is entrusted to us, now and in the future. Nothing is more definite about my future than my own death. Estate planning is seen as an unpleasant or even dreaded task, says The Message in the article “Estate planning is stewardship.” However, think of estate planning as a message to the future and stewardship of your life’s work.
Some people think that if they make plans for their estate, their lives will end. They acknowledge that this doesn’t make sense, but still they feel that way. Others take a more cavalier approach and say that “someone else will have to deal with that mess when I’m gone.”
However, we should plan for the future, if only to ensure that our children and grandchildren, if we have them, or friends and loved ones, have an easier time of it when we pass away.
A thought-out estate plan is a gift to those we love.
Start by considering the people who are most important to you. This should include anyone in your care during your lifetime and for whom you wish to provide care after your death. That may be your children, spouse, grandchildren, parents, nieces, and nephews, as well as those you wish to take care of with either a monetary gift or a personal item that has meaning for you.
This is also the time to consider whether you’d like to leave some of your assets to a house of worship or other charity that has meaning to you. It might be an animal shelter, community center, or any place that you have a connection to. Charitable giving can also be a part of your legacy.
To exercise good stewardship, you need to know where you are. Your assets should be listed in a careful inventory. It is important to include bank and investment accounts, your home, a second home or any rental property, cars, boats, jewelry, firearms, and anything of significance. You may want to speak with your heirs to learn whether there are any of your personal possessions that have great meaning to them and figure out to whom you want to leave these items. Some of these items have more sentimental than market value, but they are equally important to address in an estate plan.
There are other assets to address: life insurance policies, annuities, IRAs and other retirement plans, along with pension accounts. Note that these assets likely have a beneficiary designation and are not distributed by your will. Whomever the beneficiary is listed on these documents will receive these assets upon your death, regardless of what your will says. Having proper and coordinated beneficiary designations is an important part of your estate planning.
If you have not reviewed these beneficiary designations in more than three years, it would be wise to review them. The IRA that you opened at your first job some thirty years ago may have designated someone you may not even know now! Once you pass, there will be no way to change any of these beneficiaries.
Work with an experienced estate planning attorney to create your last will and testament and/or revocable trust. The Will delivers property through probate, a court-supervised division process. A trust that contains your assets can avoid that process. Either path, however, is much better than not exercising good stewardship.
Many people express concern about the cost of estate planning. There can be high and tragic costs for not planning. Remember that there are important and long-lasting decisions included in your estate plan, so it is worth the time, energy, and money to make sure these plans are created properly.
Compare the cost of an estate plan to the cost of buying tires for a car. Tires are a cost of owning a car, but it’s better to get a good set of tires and pay the price upfront than it is to buy an inexpensive set and find out they don’t hold the road in a bad situation. It’s a good analogy for estate planning.
Reference: The Message (June 14, 2019) “Estate planning is stewardship.”