Japan Peak Global Management - What You Don’t Know About Estate Management To Protect Your Family
Posted on Nov 23 2022 4:41 AM
"Whether people like it or not, things that are under a certain person’s ownership will eventually be passed to another at some point in time. "
Though there is nothing wrong with accumulating assets and other valuables, owners should also think about their legacy and where these items will be channeled in the long run. More than that, they should also think of how they can effectively pass on these things without causing or fueling any drifts.
In some cases, passing over assets causes turmoil among heirs and beneficiaries. Hence, for things to go smoothly, individuals should consider availing of services such as estate management.
What is Estate Management?
Estate management or planning refers to the entire process of deciding how assets and other valuables will be distributed after the owner’s incapacitation or passing.
The term "estate" is actually all-encompassing. It may include vehicles, investments, bank accounts, real estate, furniture, jewelry, insurance, and other valuable items.
One primary goal of estate planning is to make sure that the designated beneficiaries and heirs will receive the assets in a manner that effectively reduces tax in its many forms—including gift taxes, estate taxes, and other tax implications.
Other than that, when the distribution is carefully crafted and thought out, the process of handing over such assets is also clearer. The specific things that are left behind will be turned over to the designated person, be it family, relatives, or a certain organization.
Is Estate Planning Really Important?
Though others would rather focus on planning for vacations or big projects over estate planning, the latter is actually important and should not be taken for granted. Unless estate management is conducted, individuals do not get to choose who becomes the recipient of their hard-earned items.
It doesn’t matter whether the person is rich or poor; in the end, all their remaining items need to be turned over in the event of their incapacitation.
Here are some concrete reasons why estate management matters.
1. Estate management spares the beneficiaries or heirs from incurring large tax bills.
One of the most important things about estate management is that it enables individuals to hand over assets to beneficiaries and heirs with the least amount of tax.
With even minimal estate planning, there are chances for federal taxes, state taxes, and state inheritance taxes to be reduced or nullified completely. The income tax that beneficiaries would have to pay can also be lessened.
However, if no plan was made beforehand, the taxes that heirs and beneficiaries will have to pay may end up being significant.
2. Estate management shields beneficiaries.
In the past, estate planning was perceived as being only for the wealthy. However, this is not the case anymore. Even middle-class families need to come up with a plan if something happens to the breadwinner.
Even if the asset to be turned over is a simple, small home, individuals cannot control who will receive the asset if the decision was not made beforehand.
This is because the pivotal key to estate management is choosing who will receive the assets, be they land or stocks. Without an estate plan, the court will have to choose the recipients of the assets.
This entire process can last for years and may even cause drifts between families. The court does not know the context in the household (i.e., the responsible sibling or the one who should not receive free cash).
Due to the absence of estate planning, things don’t turn out pretty a lot of times.
3. Estate management protects the young.
Nobody wants to pass away or become incapacitated at a young age. However, the risks and possibilities cannot be taken for granted. This possibility is especially highlighted for parents who are raising very young children.
To make sure that these young children receive appropriate care, parents can decide who the legal guardian will be in case both of them pass before the child reaches a legal age.
If there is no indication of who the guardians will be, the court will be the one to decide who gets to raise the child.
4. Estate management prevents family drifts.
It is not uncommon for siblings and relatives to drift against each other when it comes to inheritance and the turning over of assets. At times, matters escalate significantly enough that siblings and relatives may have to face each other in court.
With a proper estate plan, such drifts can be prevented altogether.
Other than that, estate planning can also allow owners to come up with customized and personalized plans. For example, a child with a certain health condition may be allotted a certain amount for treatment.
While the estate can be divided equally, it is up to the owner’s discretion to decide how it should be divided and allocated.
Moreover, if the asset owner has had more than one spouse or has children from another family, an estate plan is clearly necessary and urgent.
Getting Started With Estate Planning
Though the process of estate management is not that complex, there are still some things that individuals should keep in mind and do.
Here are some things that need to be done as part of estate management:
- List all assets and valuable items (tangible and intangible).
- Think about the needs of the family (i.e., insurance, a designated guardian, specifics about child care).
- Come up with directives (i.e., trust, healthcare).
- Review registered beneficiaries in insurance, retirement, and other accounts.
- Note the estate tax laws in the state.
- Reassess the plan whenever certain circumstances change, whether positively or negatively.
While there is still more to estate management, these are some things that individuals need to do as part of the process.
Partner With A Professional
Though estate planning can be conducted alone, its execution will still be smoother when a professional is entrusted to push through with it. In this case, individuals can partner with Peak Global Management.
Peak Global Management Japan is there to walk with individuals throughout the entire estate management process. In the event of incapacitation, Peak Global Management will also ensure that the estate plan is carried out. This way, individuals need not worry about whether their estate plan will push through or not. With the help of a professional, they can rest assured that the plan will still be executed.
Contact Peak Global Management for your estate management needs.
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