Who needs what? What’s the difference?

Everyone has an estate. Rich or poor, it doesn’t matter. When you die, you leave behind an estate. For some, this can mean property, cash money, assets and more. For others it could be as simple as the $10 bill in their wallet and the clothes on their back. Either way, what you leave behind when you die is considered to be your “estate”.

Why plan? Well, even if you’re just leaving behind the $10 bill in your wallet, who will inherit it? Do you have a spouse? Children? Is it theirs? Should it go to just one of them, or be split between them? This (quite simply) is what estate planning is all about. Estate planning determines how your money and assets (property – both real and personal) will be distributed after your lifetime.

Who needs estate planning? While it is absolutely possible to die without planning your estate, I wouldn’t say it is advisable. If you die without an estate plan, your family could face major legal issues and (possibly) bitter disputes. So in my opinion, everyone should do some form of estate planning. Your estate plan could include wills and trusts, life insurance, disability insurance, a living will, a pre- or post-nuptial agreement, long-term care insurance, power of attorney and more.

Why not just a will? Did you know that your heirs may need to file a petition to probate your estate … even if you have a will? Basically, a will tells the world what you’d like to have happen, but other items (like properly prepared and funded trusts) can provide the tools to make things happen, and help your heirs to avoid probate.

So, what is “advanced” estate planning? Advanced estate planning is generally something those with a very high net worth should consider. For example, if you are single and your net worth exceeds $1.5 million dollars, or if you are married and (as a couple) your net worth exceeds $3.5 million dollars, you should consider advanced estate planning. The main purpose of advanced estate planning is to reduce taxes. The use of unified credit, gifting strategies, trusts and more can help your heirs receive the highest benefits possible under federal and state laws.

Where do you begin? Whether you need basic or advanced estate planning, I would advise you to speak with qualified professionals. A Financial Advisor can refer you to a good estate planning attorney and a qualified tax professional, and lead a team effort to assist you in drafting your legal documents. Many financial professionals have relationships with attorneys and accountants, so the advisor you consult may be able to refer you to the right specialists.

Rob Siddoway, JD, MBA, CFP® is an Investment Advisor Representative with Tetrant Advisory LLC and may be reached at, (888) 852-8070, or

These are the views of Peter Montoya, Inc., not the named Representative or Registered Investment Advisor, and should not be construed as investment advice. Tetrant Advisory LLC does not give tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your Financial Advisor for further information.

* As of 2006