If you’re behind in planning for your financial legacy and final wishes, you’re not alone. A 2021 poll by Gallup found that less than half (46%) of U.S. adults have a will in place—a percentage that hasn’t changed much since the question was first asked in 1990.
Think about that for a moment—not even the COVID-19 pandemic was enough to push more than half of Americans to engage in end-of-life planning.
It’s a statistic that reminds us we have important work to do here at Cedar Point Capital Partners, for three primary reasons:
- Planning for your financial legacy doesn’t have to be hard (or even involve attorneys)
- Stipulating your final wishes doesn’t require some grand appraisal of your life or your own mortality (but sometimes it’s good for that)
- A vast majority of us have real, valuable assets that need to be protected and accounted for after our passing
Yes, that includes you, the person with the modest house and the older car, and the hard-earned nest egg. Your assets can improve the lives of your family and the people in your community long after your passing, but they have to be planned and structured with financial and legal rigor.
You should know there are potentially very real risks to your assets by kicking estate planning down the road. Intestacy laws in every state stipulate how property is distributed when someone passes away without a valid will.
In the state of Iowa, for example, any property without a designated beneficiary will be distributed in district court via probate code, a set order that goes from your spouse and children, to other relatives, and then finally the state itself. This lack of control can result in assets being distributed in ways that could result in unnecessary taxes and legal complications—and possibly not align with your final wishes.
By spending a little time today on estate planning, you can make a big investment in your family’s peace of mind for years to come.
3 Steps for Creating Your Estate Plan
There are a handful of foundational legal documents every estate plan should include, as they help to ensure the owner’s final wishes are honored. The importance of these documents cannot be understated, which is one reason that we ask all new clients if they have them as part of our onboarding process.
If you don’t have an estate plan, we are happy to connect you with local attorneys and estate planning professionals who can help you evaluate your needs. You could also explore self-serve legal options, like LegalZoom, or your local Bar Association—in Iowa, the Iowa State Bar Association provides legal form templates.
While self-serve options may be more convenient and inexpensive, we feel that (generally speaking) there is no substitute for partnering with a qualified estate planning attorney.
As a fiduciary, we do not receive any sort of commission or payment for referring folks to legal counsel—we just do it because it’s the right thing to do for our clients.
So where do you start?
1. A Last Will & Testament
A last will & testament appoints an executor for your estate and outlines how your assets will be distributed after your passing. It’s a way to ensure your investments, property and savings go to the people or organizations you choose.
A well-structured will, when used in concert with trust instruments and other estate planning tools, may also reduce your tax liability and lay the foundation for your long-term financial legacy by outlining any potential philanthropic goals.
We can help you understand and map out the various parts of your estate plan, and offer recommendations, but you will need to work with a qualified attorney or estate planning professional to draft and execute the actual instrument(s). We also recommend that you revisit and review your will periodically—either with us or your counsel—to make updates as your life changes.
2. Powers of Attorney
As you build your plan for the last chapters of life, it’s essential to not only secure your post-death wishes, but also protect your interests during your lifetime. One often overlooked but critical piece of planning should be executing power(s) of attorney.
Power of Attorney (POA) documents grant someone you trust (known as an ‘agent’) the legal authority to make decisions on your behalf, most commonly in cases where you become incapacitated. There are many different types of POAs you can procure, but the two most common ones are:
- Financial Power of Attorney: This document appoints an agent to manage your financial affairs if you are unable or unwilling. With this power, an agent can pay bills, manage investments, and make financial decisions according to your wishes. Without it, accessing your assets or making financial decisions on your behalf can be incredibly challenging and time-consuming for your loved ones.
- Health Care Power of Attorney (Medical Power of Attorney): This document designates someone to make health care decisions for you if you're unable to do so due to illness or incapacity. This person will work with your health care providers to ensure your medical treatment aligns with your preferences and values.
You may have also heard of a Living Will, which stipulates how you would like to receive medical care in the event you are alive but incapacitated. This can be used by your doctor and POA agent to guide their medical decisions on your behalf. Having a well-drafted and executed living will provides clarity and peace of mind for both the individual and their loved ones during difficult medical situations.
These discussions are some of the hardest parts of end-of-life planning for many of our clients. That’s probably because of the loss of control it represents—but we like to think that it actually brings freedom to those you love. That’s what real financial life planning is about.
3. Talking to Your Family
We ask a lot of questions about your estate plan during the onboarding process here at Cedar Point Capital Partners, because we want to help you build a tailored financial legacy you can be proud of. But the work doesn’t end once you have executed a will and/or POA(s).
You also need to sit down with your family and/or loved ones to discuss your plans, because they will be the ones to move them forward when you are gone.
Sharing how you want your final wishes handled can be a difficult discussion, but it is crucial for preventing confusion and conflicts down the road. We find that reviewing and discussing your estate plan—and sharing why you made the decisions you did—can alleviate the emotional burden on your family, and allow them to focus on supporting each other rather than making tough decisions without guidance.
If you are ready to create an estate plan and build your financial legacy, let us show you how we’re different. Give us a call today for a free consultation, and let’s grow together.
The commentary on this blog reflects the personal opinions, viewpoints, and analyses of Cedar Point Capital Partners (CPCP) employees providing such comments and should not be regarded as a description of advisory services provided by CPCP or performance returns of any CPCP client. The views reflected in the commentary are subject to change at any time without notice. Nothing on this blog constitutes investment advice, performance data or any recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Cedar Point Capital Partners manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.