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A balanced approach to estate planning

On Behalf of | May 24, 2022 | Estate Planning |

Estate planning has many different components for families in California, and the larger the estate is, the more complex the plan needs to be. There are multiple considerations, such as tax savings, asset preservation, seamless transitions, and managing outstanding issues.

Balancing estate planning

The different goals of estate planning can sometimes conflict, and prioritizing one can make the others harder to achieve. For example, one major goal is minimizing the tax burden of the estate. There are lots of ways to accomplish this, and some of them can become difficult, involving multiple trusts and splitting different assets across the trusts at different times. However, this can also make it hard for the family to keep track of the assets and manage a custodial transfer to the next generation. That increases the risk of something going wrong.

A more balanced approach will take all of the family’s goals into account at once, creating a unified plan that gives the family a clear pathway to transition their assets. A plan that focuses too much on one goal can undermine others, compromising the whole vision and risking problems. Estate plans also need to be a bit flexible to manage any unexpected events that might occur along the way, so they can’t be completely set in stone.

The earlier estate planning starts, the easier it is to come up with a balanced plan that can accommodate the needs of the family. Estate planning does not need to sacrifice one goal for another if it integrates the family’s desires and takes into consideration variables that can crop up over time.