December 2003 Bulletin

Tackling estate issues

Plan ahead to establish goals, objectives

By Joel M. Blau, CFP and
Ronald J. Paprocki, JD, CFP, CEO

Few orthopaedic surgeons view estate planning as an urgent or immediate need. Yet without a properly structured estate plan, your heirs may end up paying unnecessary estate taxes and probate fees that in many cases can be dramatically reduced or even eliminated.

Financial planners can assist in determining the various goals, objectives and actual structure of the estate plan. You will need to engage the services of a qualified estate-planning attorney, however, to draft and implement your plan. Be well prepared prior to the initial meeting so you can save substantial time and money.

Various considerations
There are several topics to consider before meeting with the attorney who will be drafting the estate planning documents. For individuals with minor children, one of the most important and difficult decisions involves choosing a guardian. You must consider who is best able to cope with raising your children. While your heart may tell you to select grandparents, be mindful of their ages and ability to raise another family. Other options include choosing a sibling or a close friend.

Additional factors to consider include: the age of the proposed guardians and the age(s) of their children, age(s) of your children, the number of children who are minors and the health and financial situation of all parties.
It is also an excellent idea to decide on alternative choices, in the event your first choice is unwilling or unable to serve. If you name a married couple as guardians and one of them dies, decide whether or not you want their surviving spouse to act as the sole guardian. The same decision should be made in the event that the guardians become divorced.

Executor’s role
You also will have to select an executor for your estate. It is the executor’s responsibility, via the probate process, to handle the details of paying any debts of the estate, paying death taxes and distributing the remaining assets to the beneficiaries named in your will.

Before meeting with the attorney, be sure that you have made a list of all of your assets, including value and ownership (individually or jointly). This gives the attorney a quick snapshot of the value of your estate as well as the level of probate exposure.

If you decide to use various trust strategies, you will need to name a trustee to manage investments and take care of issues such as distributions related to the trust. The trustee can be an individual or a corporate fiduciary, such as a bank trust company.

Age plays a factor
Another decision addresses the ages of your children at the time the estate is distributed. If you do not want to distribute assets outright—in a lump sum—to your children in the event of your and/or your spouse’s death, the assets can be held in trust for their benefit.

The ultimate distribution does not have to be made as a lump sum. Many people prefer to make distributions of a portion of the estate at several different times; for example, one-third at age 21, one-third at age 25, and one-third at age 30 or any other combination you think works best for your children.

Lastly, you will need to make arrangements in the unlikely event that your children predecease the distribution of the estate. If this happened, you would want to decide who the beneficiaries would be—other relatives, friends, or even charity.

Although these issues are difficult and emotionally taxing to address, planning ahead will eliminate the stress of making these decisions under emotional duress.

Joel M. Blau, CFP, is president of MEDIQUS Asset Advisors, Inc. He can be reached at (800) 883-8555 or

Ronald J. Paprocki, JD, CFP, is chief operating officer of MEDIQUS.

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