Have you looked at the true value of your assets recently? If your business has been growing or if your land has increased in value, the figures might surprise you.
In most cases, growth is a cause for celebration. However, if your estate plan uses outdated figures, you could have some risk exposure of which you are not aware. Here are some quick tips on how you might manage risk during periods of success.
Keeping abreast of the federal tax law is one of the best ways you can minimize your estate’s risk exposure. Many years, there are relatively predictable changes. However, new laws and new structures could result in larger shifts, especially when different political parties gain control of the various branches of government. Is usually a good idea to check every year — and to double check during election years — to keep your strategy appropriate for the new tax environment.
Managing assets is a key element of avoiding the high percentage costs of federal estate taxes. For example, a life insurance policy that was a good investment in the past could push your estate over certain limits and expose you to higher levels of risk. Luckily, there are some trusts with the exact purpose of addressing this problem, as well as tools for many other situations.
Another way you could potentially preclude the risk of large estate taxes is to take advantage of the maximum gift allowance. This could be especially useful for spouses. You may also be able to give gifts during your lifetime to your children so that they could contribute early to their own retirement plans.
A comprehensive estate plan is about more than just the numbers. It is a way for you to secure long-term goals for yourself, your business and your family. As your objectives and situations change, make sure your strategy changes as well.