The Basics of Estate Planning | WT Wealth Management White Paper

Let's get this out of the way first: the advisors at WT Wealth Management are not practicing attorneys. However, in our roles as financial advisor fiduciaries, each member of our team works and networks with estate planning specialists in dozens of states. We also have the experience of seeing good and bad situations after our clients pass away.

The Covid-19 pandemic has increased Americans' awareness of the need to have a will, a living trust or another similar end-of-life document prepared. Yet, according to a new survey from senior living referral service, only about 33% of Americans have put these plans in place. That means that 67% of us are leaving what happens to us and our assets, in case of disability or death, up to others, including the state.

The biggest reasons people cite for not getting something in place: They just haven't gotten around to it, according to 40% of survey respondents. Another 33% said they don't believe they have enough assets to pass on to their loved ones. 13% said the estate-planning process is too costly. And 12% said they do not know how to get a will. (1)

Consumer Sentiment

Estate planning is the process of designating who will receive your assets in the event of your death or incapacitation. Often done with guidance from an attorney, one primary goal is to ensure heirs and beneficiaries receive assets in a way that manages and minimizes estate taxes, gift taxes and other tax impacts.

We always tell clients, "make the transition after your passing as easy as possible for your loved ones, heirs and friends by having a plan in place. Rather than burden loved ones with the task of organizing your financial affairs after the fact, your preparation now will allow them to peacefully grieve."

Here are 5 steps to consider when starting your plan.

Inventory Your Stuff

You may think, like 33% of Americans, that you don't have enough assets to justify estate planning. But you might be surprised by all the tangible and intangible assets you have.

Tangible assets in an estate may include:

Intangible assets in an estate may include:

Once you inventory your tangible and intangible assets, you need to estimate their value. For some assets, third-party valuations such as appraisals, account statements, business valuations, and so forth, can help. When you don't have a third-party valuation, value the items based on how you expect your heirs will value them. This can help ensure your possessions are distributed equitably among the people you love. (2)

Establish Your Wishes

A key objective in estate planning is bypassing probate, a process by which the courts determine how to distribute your property to your heirs. The process is long (commonly 12 to 24 months) and follows government statutes that may or may not be compatible with your wishes.

In some cases, a trust might be appropriate. With a revocable living trust, you can designate portions of your estate to go toward certain things while you're alive. If you become ill or incapacitated, your selected trustee can take over. Upon your death, the trust assets transfer to your designated beneficiaries, bypassing probate. There's also the option to set up an irrevocable trust, which can't easily be changed or revoked by the creator. Typically, irrevocable trusts are used by people with large estates as a means of getting assets out of their estate, thereby reducing estate taxes.

A medical care directive, also known as a living-will, spells out your wishes for medical care if you become unable to make those decisions yourself. You can also give a trusted person medical power of attorney for your health care, giving that person the authority to make decisions if you can't. These two documents are sometimes combined into one, known as an advance health care directive.

A durable financial power of attorney allows someone else to manage your financial affairs if you're medically unable to do so. Your designated agent, as directed in the document, can act on your behalf in legal and financial situations when you can't. This includes paying your bills and taxes, as well as accessing and managing your assets.

A limited power of attorney can be useful if the idea of turning over everything to someone else concerns you. This legal document does just what its name says: it imposes limits on the powers of your named representative. For example, you could grant someone the power to sign documents on your behalf at the closing of a home sale or to sell a specific stock.

Be careful about who you choose to give power of attorney. They may literally have your financial well-being — and even your life — in their hands. Some people choose to assign medical and financial representation to different people, as well as designating a backup for each in case your primary choice is unavailable when needed. (3)

Review Your Beneficiaries

Your will, your trust or other documents may spell out your wishes, however wills and trusts may not be all-inclusive.

Check your retirement and insurance accounts. Retirement plans and insurance products typically have beneficiary designations that you need to keep track of and update as needed. Beneficiary designations can trump what's outlined in a will or trust.

People sometimes forget the beneficiaries they named on policies or accounts established many years ago. If, for example, your ex-spouse is still a beneficiary on your life insurance policy, your current spouse will get the bad news — and none of the policy's payout — after you're gone.

Name contingent beneficiaries. These backup beneficiaries are critical if your primary beneficiary dies before you do and you forget to update the primary beneficiary designation.

Consider the Value of Professional Advice

Whether you should hire an attorney or estate tax professional to help create your estate plan generally depends on your situation. If your estate is small and your wishes are simple, an online or packaged will-writing program may be sufficient for your needs.

If you have doubts about the process, it might be worthwhile to work with your financial advisor and jointly consult an estate attorney and possibly a tax advisor. Professionals can help you determine if you're on the proper estate planning path, especially if you live in a state with estate or inheritance taxes. (4)

Plan to Reassess

Life changes. So should your estate plan. The opportunity to revise a plan means you've already avoided the biggest mistake: never drafting an estate plan at all.

Revisit your estate plan when your circumstances change – for better or for worse. This may include a marriage or divorce, birth of a child, loss of a loved one, getting a new job or being terminated.

Revisit your estate plan periodically even if your circumstances don't change. Although your situation may be the same, state and federal laws may have changed.

WT Wealth Management has relationships with estate planning specialists in nearly every market where we have clients. (5) We'd be happy to make a professional introduction and sit through the initial meetings with you to ensure the fit between you and your estate planning specialist is a good one.

As with all other White Papers, our goal here is to impart basic wisdom, provoke thought and start conversations. We stand by to help answer basic questions about your portfolio and provide guidance and recommendations when other expertise is needed. Please reach out to your advisor if you would like to discuss more.

  1. 67% of Americans have no estate plan, survey finds
  2. Estate Planning: A 7-Step Checklist of the Basics
  3. Estate Planning 101: What is Estate Planning?
  4. Estate Planning: 16 Things to Do Before You Die
  5. Sedona's Estate Planning Attorney w/ Alma Dumitru Esq.


There are no warranties implied.
Any opinions expressed on this website are the opinions of WT Wealth Management and its associates only. Material listed on this website is neither an offer to buy or sell securities nor should it be interpreted as personal financial advice. You should always seek out the advice of a qualified investment professional before deciding to invest. Investing in stocks, bonds, mutual funds and ETF’s carry certain specific risks and part or all of your account value can be lost.

At WT Wealth Management we strongly suggest having a personal financial plan in place before making any investment decisions including understanding your personal risk tolerance and having clearly outlined investment objectives.

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WT Wealth Management is an SEC registered investment adviser, with in excess of $100 million in assets under management (AUM) with offices in Flagstaff, Scottsdale, Sedona and Tucson, AZ along with Jackson Hole, WY and Las Vegas, NV. WT Wealth Management is a manager of Separately Managed Accounts (SMAs). With SMAs, performance can vary widely from investor to investor as each portfolio is individually constructed and managed. Asset allocation weightings are determined based on a wide array of economic and market conditions the day the funds are invested. In an SMA, each investor may own individual Exchange Traded Funds (ETFs), individual equities or mutual funds. As the manager we have the freedom and flexibility to tailor the portfolio to address an individual investor's personal risk tolerance and investment objectives – thus making the account “separate” and distinct from all others we manage. An investment with WT Wealth Management is not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other government agency. Any opinions expressed are the opinions of WT Wealth Management and its associates only. Information offered is neither an offer to buy or sell securities nor should it be interpreted as personal financial advice. Always seek out the advice of a qualified investment professional before deciding to invest. Investing in stocks, bonds, mutual funds and ETFs carries certain specific risks and part or all of an account's value can be lost. In addition to the normal risks associated with investing, narrowly focused investments, investments in smaller companies, sector and/or thematic ETFs and investments in single countries typically exhibit higher volatility. International, Emerging Market and Frontier Market ETFs, mutual funds and individual securities may involve risk of capital loss from unfavorable fluctuations in currency values, from differences in generally accepted accounting principles or from economic or political instability that other nations experience. Individual bonds, bond mutual funds and bond ETFs will typically decrease in value as interest rates rise. A portion of a municipal bond fund's income may be subject to federal or state income taxes or the alternative minimum tax. Capital gains (short and long-term), if any, are subject to capital gains tax. Diversification and asset allocation may not protect against market risk or investment losses. At WT Wealth Management, we strongly suggest having a personal financial plan in place before making any investment decisions including understanding personal risk tolerance, having clearly outlined investment objectives and a clearly defined investment time horizon. WT Wealth Management may only transact business in those states in which it is registered, or qualifies for an exemption or exclusion from registration requirements. Individualized responses to persons that involve either the effecting of transactions in securities, or the rendering of personalized investment advice for compensation, will not be made without registration or exemption. WT Wealth Management's website is limited to the dissemination of general information pertaining to its advisory services, together with access to additional investment-related information, publications, and links. Accordingly, the publication of WT Wealth Management's website should not be construed by any consumer and/or prospective client as WT Wealth Management's solicitation to effect, or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation, over the internet. Any subsequent, direct communication by WT Wealth Management with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides. A copy of WT Wealth Management's current written disclosure statement discussing WT Wealth Management's registrations, business operations, services, and fees is available at the SEC's investment adviser public information website (www. or from WT Wealth Management directly. WT Wealth Management does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to WT Wealth Management's web site or incorporated therein, and takes no responsibility therefor. All such information is provided solely for convenience purposes and all users thereof should be guided accordingly.

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