We’re pleased to provide you with insights like these from Boston Private. Boston Private is now an SVB company. Together we’re well positioned to offer you the service, understanding, guidance and solutions to help you discover opportunities and build wealth – now and in the future.
Keep plans in sync
A part of the Engaging Aging Parents series
A well-crafted estate plan allows you to control the administration and disposition of your assets, both during your lifetime and when you have passed away. Unfortunately, many do not have a plan in place. With no plan you have no control, and it guarantees additional time and expense will be spent with no assurances your assets will pass as you would have wanted.
If you suspect your aging parent does not have a plan, does not have an adequate plan, or has a plan that is dated, now is the time to start the planning conversation. Do they have a plan, have they appropriately completed beneficiary designations, do they have a complete inventory of their assets and know how their assets are titled?
The benefits of beneficiaries
The probate process can be long, frustrating and expensive. One of the key reasons why we do estate planning is to avoid the probate process to the greatest extent possible. Assets like annuities, retirement accounts and life insurance allow you to designate a beneficiary, and when properly executed, beneficiary designations allow those assets to bypass the probate process and go directly to the named beneficiary.
Bank and financial accounts can also have joint owners or payable on death designations. These will also allow these assets to avoid probate and pass directly to the surviving owner(s) or payable on death beneficiary.
Having a revocable trust in place that has been funded (assets have been retitled into trust name) also allows you to avoid probate for those assets placed in trust. A revocable trust is not a separate entity and the grantor maintains complete control of the assets placed in to it. Revocable trusts allow for seamless administration of trust assets, during lifetime, in the event of incapacity and after death. Revocable trusts also allow married couples to fully utilize their state and federal estate tax exemptions. The trust will contain provisions for how and when you wish for your beneficiaries to receive trust funds.
Careful execution of beneficiary designations, account titling and utilizing trusts and other important estate planning documents are crucial to ensuring your parents estate planning and wealth transfer success.
Organizing and tracking
If your parent has numerous accounts, perhaps at several financial institutions, keeping track of their various and sundry assets may be difficult. Therefore, it's best to inventory everything they own or manage and keep it in one safe location. An inventory manager, which your SVB Private advisor will provide, serves as an excellent tool to track and manage everything — not just the assets, but the account numbers and passwords by asset type. Your parents' advisor will have access to this in case anything happens and will share it with whomever your parent designates, should something happen to them.
Maintain up-to-date documentation
Work with your parent to ensure that they review their accounts and beneficiary status with their advisors periodically — once a year or after any significant life change — to make sure the actual beneficiary matches their intention. If there is a mismatch, help your parent swiftly correct the discrepancy. By doing this, you can rest easy that your aging parent and their wishes will be carried out as they intended and as smoothly as possible.
If you have questions call upon your team of professionals at SVB Private to be sure both you and your parents have charted a course for success.
For more information, get the Engaging Aging Parents guide or visit our full Parents Series page here.
