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I just finished reading a book called Estate Planning 101 by Vicki Cook and Amy Blacklock. If you haven’t gotten your affairs in order yet, this book can really help get you on track. You can check out the book here.
Let’s be honest – estate planning isn’t the most exciting topic. That said, it might be one of the most important subject matters you ever focus on.
I dug into this quite a bit in 2013, a few years after our daughter was born. I wanted to be sure that if something happened to me and Lisa, our daughter would be taken care of and our “estate” would be passed down properly.
I put “estate” in quotes because a lot of folks assume that you need to be rich to have an estate, but that’s simply not the case in estate planning. Any bank accounts, investments you have (i.e. 401(k) plan), property, etc. constitutes an estate. At the time we started this, our net worth was just a fraction of what it was today at right around the $500,000 mark.
We met with an estate planning attorney, discussed our options, and then created an estate plan to be executed should something happen to me, my wife, or both of us. In our case, this included:
- A revocable trust
- Pour-over wills
- Durable general powers of attorney
- Health care powers of attorney
- Assignment of LLC interest documents
We also purchased 30-year term life insurance policies and later I purchased long-term disability insurance.
Overall, it was a time-consuming pain in the butt… especially funding the revocable trust. This involves re-titling all assets to be owned by the trust. And, of course, we spent a cost a good chunk of change with the estate planning attorney. With the help of some old Quicken data, I was able to find that it was a total of $2,032.44 for the attorney fees.
But guess what – I sleep so much better now knowing that we have something solid in place to help protect ourselves and our daughter in the event of a tragedy.
Be aware though that just because this was the path we took, it might not be the same for you. Everyone’s situation is different and that means you’ll have to determine the right strategy for you.
Perhaps having a will, along with some powers of attorney documents might suffice. Or maybe you’ll need something much more elaborate.
The good news is that Vicki and Amy’s Estate Planning 101 book is an excellent resource in understanding what you might need. The long subtitle of the book says it all… “From Avoiding Probate and Assessing Assets to Establishing Directives and Understanding Taxes, Your Essential Primer to Estate Planning.”
I first met Amy and Vicki at a conference for personal finance content creators called FinCon in 2017 and I loved both of them right off the rip. In fact, Amy helped with some touch-up on my impromptu Mohawk for the Halloween party. We’ve all gotten together a few times since and they’re just great people to be around – fun and smart!
So I was excited to hear that they wrote this book because I knew they’d put a lot of time and research into doing it well… and they did.
Here’s the chapter outline:
- Chapter 1: What Is an Estate, and Why Does It Require a Plan?
- Chapter 2: Determining Your Estate
- Chapter 3: Taking Care of You
- Chapter 4: Taking Care of Others
- Chapter 5: Is a Trust the Answer?
- Chapter 6: Estates and Taxation
- Chapter 7: Situations Requiring Careful Consideration
- Chapter 8: Completing the Package
I’m not going to lie – it’s not going to be a nail-biter of a book, but that’s due solely to the subject matter. No one enjoys thinking about death. But it’s very well-written and covers so many facets of estate planning you might not have even thought about.
For example, here’s an important note I was unaware of…
To get rid of your first will completely, shredding it, tearing it up, burning it, or deleting electronic copies of it may not be enough. You’ll want to cancel it (and any codicils to it) by inserting a clause in your newly created will, specifically stating all prior wills and codicils are revoked. If you don’t, probating your estate can become very complicated if multiple wills are presented (this could happen if heirs have copies of prior wills). To ensure things turn out according to your latest wishes, revoke previous wills and destroy all originals and copies.— Estate Planning 101 – Chapter 4
They spend time talking about determining if you can do your estate planning on your own or if you need an attorney. This is probably the biggest question that I seem to hear from people in regards to the subject. The answer is that it depends. The good news is that the book gives you some guidance and thoughts on making that determination.
Obviously, the discussion of wills versus trusts is delved into. You’ll also find out that there are more than just those two options and choosing the right one or ones is important. This again depends on your situation, but you’ll have a much better idea of the direction to go after reading this.
They talk about probate and why you don’t want anything going through the courts if you can help it. Along with that, they discuss what’s subject to probate and what’s not.
Some people just think of estate planning as having a will or a trust to handle your affairs when you die. But just as important is having a plan in place in the case of incapacitation. For instance, how should your financial and health affairs be handled in the event you fall into a coma? The different powers of attorney are talked about that cover this very subject.
In something I didn’t expect to read much about, your estate and taxation have their own dedicated chapter. Understanding how to structure things correctly has the potential to save you or your heirs a tremendous amount of money.
Disinheritance is something they talk about that I realize I didn’t have a good understanding of before I read this book. If you don’t want someone to receive an inheritance, leaving them out of your will might not be enough. It can be contested and your wishes might not be adhered to. A smarter option is to specifically disinherit them in your estate planning documents… much harder to contest your plans that way.
There are many other topics in this book that you’ll find helpful including a section on avoiding common mistakes, digital accounts, storing your documents, and when you should change your estate plan.
In my opinion, I think it’s smart to consult with an estate planning attorney once you’re ready to create your estate planning documents regardless. Even if they aren’t that complicated, this isn’t something you want to mess up on doing.
Estate Planning 101 was a good reminder that I should update our estate planning documents. A lot has changed since we got them finalized in 2013. We’ve sold our house along with a couple of rental properties, left our jobs, opened and closed various bank and investment accounts, created the Route to Retire, LLC, and more.
If you haven’t done any estate planning, Estate Planning 101 is worth reading. It’ll help you understand your options and put you on track to have a better comprehension of what needs to be done, why, and how to make it happen.
I’d recommend reading this even if you decide to get an attorney involved later. You’ll know what the attorney is talking about and can ask the right questions to ensure that the documents are created most appropriately for your situation. If your estate plan is simple enough, you may even be able to save some money by doing some things ahead of time and simply having the attorney review your documents instead of starting from scratch.
On the other hand, as someone who already has estate planning documents in place, I can say that I still learned quite a bit from this book. And that will put me in a better position to be sure the changes I need will be implemented the way I want them to be.
This is a great book on understanding the fundamentals involved in getting your affairs in order before something happens. Unfortunately, death is something that will happen to all of us, but being able to control some aspects of your wishes might help you sleep a little better at night.
You can check out Estate Planning 101 here.
Plan well, take action, and live your best life!
Thanks for reading!!