Estate Planning

Estate planning is a process of looking at current and projected income, company value, owner assets, investment vehicles and strategies, and survivor needs in the context of federal and state estate tax rules and regulations.

An estate plan provides guidance to the business owner on cash management, risk management, investment planning, retirement planning and estate conservation. The asset allocation strategy of the plan is aligned with the financial goals, time horizon and risk tolerance of the owner. The estate plan also provides for allocation of funds and payment of obligations upon the death of the owner.

Nine out of ten U. S. businesses are family owned but seven out of ten won’t survive to the next generation. In part, this is because 51 percent of family businesses have difficulty meeting the estate tax assessments that occur upon the death of the owner.

One of the frequent – and overlooked – difficulties in executing an estate is the lengthy delay in receiving the inheritance during the probate period. Investments and other assets may take months or even years to pass through probate, during which time your loved ones receive no support from the estate. The death benefit from your life policy, however, passes directly to your beneficiary – avoiding the expense and delay of probate.

Because of the complex nature of an estate plan and changing tax rules and regulations, the business owner will benefit from working with an accountant and attorney for the asset valuation, tax implications and legal structure of the plan. Because of the uncertain nature of lifetime, the business owner will benefit from working with a knowledgeable and experienced insurance agent to select insurance products that will provide the funds and liquidity needed to meet estate plans and obligations.