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2011 Estate Planning Myths

"I don’t need an estate plan anymore."

The most important objective of every estate plan is to designate who will receive property after the owner’s death. This goal is unchanged. Strategies to address tax management at death are always important and often a motivator but, nevertheless, secondary. In difficult times, it’s good to have professionals on your side. A death in the family will have financial as well as emotional repercussions. Estate settlement can be a complicated process, with plenty of opportunity for error for amateur executors. This is especially true when the tax environment is in a period of constant change, as seems to be the case today and in the coming years. Estate settlement is one of the core services that we provide to affluent families. We are experienced, we have support systems in place, and we do this work every day.

"The new tax law ends the uncertainty."

In fact, we have more uncertainty than ever. Yes, for those who die in 2011 and 2012, there will be a $5 million exemption from the federal estate tax. No one knows the date of his or her own passing, however. It’s only prudent to plan for longer life, and for the possibility that the exemption will fall back to $1 million in 2013. If that happens, death taxes suddenly will become important to many more affluent families. According to a recent report by Spectrem Group, more than half of families with assets of $5 million to $25 million have a trust. More than a third of those with $1 million to $5 million are similarly taking advantage of trusts for their asset management. Even among families with less than $1 million, according to the Spectrem study, the incidence of trust usage has reached 11%.

To learn more about how a trust could enhance financial security for you and your family, arrange to meet with our Trust Officer, Tammy Fleming, at your earliest convenience.