elderlyestateplanningAs you may have noticed, the sandwich generation often runs into challenges when dealing with aging parents and estate planning. Most people are still holding jobs, or creating plans to build their own businesses and basically live a full life until they are much older.

One of the things that you might have been overlooking though, is estate planning. This is an important part of your life since, as you grow older, your capacity to care for your loved one may shift. Plus you may want to save more for medical expenses or for emergency medical funds. Let’s admit it, old age is old age, and this means you are more prone to illnesses and other risks in addition to the aging parent you are caring for. Grim as that may sound; you need to plan financially for these things for your family’s sake, financially.

If your parent becomes incapacitated or dies without a will and without an estate plan, you may be putting your family at risk for losing much of their inheritance and spending considerable time dealing with legal matters that could have been avoided.

Start estate planning with these steps:

1. The basic step: write a last will and testament. If you do not and you die unexpectedly, a court will do this for you and none of your wishes will be known and executed. In a will, you need to detail how you want your assets to be distributed and you have to name an executor who will personally make sure that all your plans are followed.

2. Consult with a financial advisor to shield your assets from huge taxes: there are ways to make sure that your estate taxes are at a minimum. While your spouse may inherit your assets tax-free, your children will not. One of the ways to avoid this is to set up trusts for your spouse and your children.

3. Plan who you are going to give your business to: owning a business is a big responsibility. Choose the rightful heir to your business and have an organized action plan for ownership transfer in the event that you die. This may include new partnerships, transfer of stocks, and other agreements. If you die and an incompetent person runs the business, part of, or worse, your whole business, might be sold off to pay taxes.

4. Document everything: put all your plans on paper and organize them. You also should make sure that someone knows you have all of these plans in place. Maintain a record of all your assets, real estate information, retirement plan accounts, securities, other bank accounts, and life and death insurance policies. Additionally, keep a similar record of your liabilities. All your personal information should also be in a safe yet accessible place. This way, your family will easily find them and can contact the right people who can handle everything.

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