Less than half of Americans have a will prepared, perhaps because of the grim association with one’s mortality. Even with modest assets, and no matter how old you are, having a will prepared is in everyone’s best interest.
Here are a few tips for estate planning in Texas:
No really, prepare a will
If you pass away without a will, strict Texas intestate succession laws are applied to your estate. These laws do not take into consideration broken relationships, estranged family members, ex-spouses and other asset distribution criteria that might go against your wishes if you had planned ahead.
You can draw up a simple will yourself, but if you have vast assets or a complicated estate, consult an attorney or financial advisor for guidance.
Make a list of all assets
On first thought, you may think you don’t have much of an estate to leave behind. By the time we reach middle age, we’ve accumulated more out-of-sight-out-of-mind assets than we realize. These can include the obvious assets like property, vehicles, boats and bank accounts, but there’s also retirement accounts, life insurance, 401k accounts, investments, cryptocurrency and other digital assets, and high-value items like jewelry and antiques.
Take the time to assemble a comprehensive list of your assets before you begin the task of deciding how you want everything distributed.
Estate and inheritance taxes
If you or your loved ones are Texas residents, the good news is that the state doesn’t have an estate or inheritance tax.
There are federal estate taxes, but these don’t kick in unless your estate is valued at more than $12.06 million (as of 2022).
Big life changes should be reflected in your will
It’s easy to pat yourself on the back after you’ve drawn up a will and forget about it. But big life changes, such as divorce, having children, moving to another state or large inheritances should be reflected in your will.
Long-term care for you and a living will
In the event you are no longer able to care for yourself, you should be sure that clear direction is in writing while you’re still of sound mind and body. Long-term care can be expensive. Plan ahead.