If you are planning to retire soon and don’t have an estate plan yet, the best time to create one is now. An estate plan in Louisiana plans for unexpected events, such as an accident that puts you in a coma or leads to your death.
Convert your 401(k) to a Roth IRA
An estate planning strategy that some people use when they’re nearing retirement is converting their 401(k)s to Roth IRAs. You don’t need to make regular contributions to a Roth IRA like you do with a 401(k) to keep growing the account. As long as the Roth IRA was open for five years, your beneficiaries don’t need to pay taxes on withdrawals. The government subtracts how much taxes you pay when setting up a Roth IRA from your estate’s value.
Log your assets and personal property
It’s easier to figure out what you want to do with your personal property and assets after you make a list of everything you intend to pass on. Remember to include your bank accounts and digital property. Your digital files and pets are other factors to plan for in your estate plan. You could set up a pet trust to set aside money for taking care of your pet after your death. As for your digital photos, documents and social media profiles, you may want to outline what you want your family to do with them. Maybe you want everything, or just some files, deleted. Some people want to close their social media profiles while others find it important to keep them up.
List your beneficiaries
You may also want to list everyone, including charities, to whom you want to pass on assets after your death. From there, you can play around with the numbers to figure out what’s a fair distribution.
Avoid probate
There are several estate planning strategies to save money and time by avoiding probate. Most financial accounts allow you to name a beneficiary. After your death, the account automatically passes to the beneficiary. Other ideas to consider are trusts and transfer-on-death deeds.
Creating an estate plan is easier than it seems. If you become clear on everything that you own and to whom you want to leave behind an inheritance, you can effectively plan how to distribute your property after your death.