In our first issue of Insight, we introduced the concept of Values Centered Estate Planning, an approach that integrates your fundamental ideals and values with your financial objectives to create a financial plan that does more than allocating assets. By emphasizing what you value rather than simply what you own, values centered planning helps align your monetary objectives with your personal ideals--to benefit you, your family, and the people and causes you care about.
Although you should consult an investment professional or tax attorney, this is not your first step. To develop an estate plan that is uniquely yours, the planning process must begin with you--your thoughts and aspirations for yourself and your family, and your ideas on particular causes and charitable organizations that you might like to support.
The Values Centered approach to estate planning is a seven-step process, with each step building on the previous one. Steps one through four, discussed in our previous issue, initiate the gradual, reflective process key to the values centered approach. We will review those steps quickly, then describe steps 5, 6 and 7 in detail.
Steps #1 to 4
First, make a rough, conservative valuation of your assets. Then, based on that initial valuation, decide how much money and property you wish to leave to loved ones, excluding your spouse (because providing for your spouse will be considered later in the process) and determine what you wish to accomplish with the rest of your assets. These decisions will reflect your personal values. Next, build your knowledge base of financial and estate planning options and charitable giving techniques. (NationalAcademics.org/Planning is a good place to start.)
Only then, after completing these initial steps, should you consult an estate planning professional. Select a qualified professional who is experienced in the family and business matters of concern to you, and who has worked with estates approximately the same size as yours. Be sure that you are personally comfortable with your advisor, and that he or she takes time to help you understand your options clearly. At this stage, also ascertain that your advisor understands what you wish to accomplish with your assets, and is prepared to assist you in providing not only for your financial goals, but for your values objectives as well. If you have difficulty finding a good advisor, consider doing a search for an estate planning attorney in your region at actec.org.
Step #5: Craft Your Plan
Your estate planning professional will make recommendations based on your assets and liabilities, your wishes for your family and loved ones, and your decisions about charitable organizations that reflect your values. This is the time when your spouse's welfare should be considered most carefully.
Thoroughly investigate the specific estate planning vehicles and charitable giving techniques recommended by your advisor. There are many online resources--including the National Academies' estate planning site, NationalAcademics.org/Planning--as well as useful books, such as J.K. Lasser's Estate Planning for Baby Boomers and Retirees: A comprehensive Guide to Estate Planning by Stewart H. Welch, III; and Plan Your Estate: Absohutely Everything You Need to Know to Protect Your Loved Ones by Denis Clifford and Corn Jordan. Your research should prompt new questions, identify potential areas of concern to address with your advisor, and enable you to make improvements in the recommended plan.
Step #6: Implement Your Plan
This is a significant point in the Estate Planning process--many people, having developed a strategic plan, don't take action on it. Be sure to follow through at this critical time. To help your implementation efforts, ask your advisors to provide you with a step-by-step list of the actions necessary to put your plan into …