facebook twitter instagram linkedin google youtube vimeo tumblr yelp rss email podcast phone blog search brokercheck brokercheck Play Pause
When and Why Estate Planning Matters Thumbnail

When and Why Estate Planning Matters

When and Why Estate Planning Matters


If you died tomorrow, who would inherit your house? What about your investment accounts, rental properties, or vehicles? Who would take care of your kids and pets? Estate planning provides peace of mind by ensuring you always have an answer to those important questions. Estate planning comprises the use of a variety of legal arrangements and strategies, such as wills, trusts, and lifetime gifting, to clearly communicate and enforce how you want your assets to be distributed when you die or become incapacitated and who you want to take custody of any minor children or pets you may leave behind. 

Estate plans can be as simple or complex as you desire. In addition to dictating how your assets will be distributed, your estate plan can be part of a larger strategy to protect your assets from creditors or lawsuits during your lifetime and minimize the tax burden on your estate after you die. In the absence of an established, legally binding estate plan, courts will distribute your estate on your behalf in a public probate process that is often costly, time-consuming, and stressful for your grieving loved ones. With an estate plan, you can breathe a little easier knowing you have made sure your loved ones will receive your assets in a timely and private manner in keeping with your wishes. 

Excellent Times to Create or Update an Estate Plan In Early Adulthood

Estate planning may not be top of mind for most young adults, but early adulthood is an ideal time to begin. Getting a head start when you’re young can help you understand the processes involved in estate planning and establish a solid foundation you can adapt as your circumstances change. At this stage, it’s a good idea to take a mental inventory of your assets and think about how you would want them to be distributed if the worst happened. You may also want to establish basic documents, such as a will and a health-care directive. 

After a Marriage or Divorce

If you recently went through a significant change in your relationship, such as marriage or divorce, it’s important to update your beneficiaries in your estate planning documents and on your financial accounts to reflect that change. If you have not yet established an estate plan, a significant life change can be an effective prompt for doing so. 

When You Have Children

Having children brings many new responsibilities, and one of those is ensuring your children will be well cared for if you were to pass away prematurely. This includes designating a guardian for them in your will and also may include creating a revocable living trust and designating a distribution timeline and a trustee who can oversee the distribution of your children’s inheritance. The guardian and trustee can be the same person, but you can select different people based on who you feel is best suited for each role. 

When You Accumulate a Significant Number of Assets

As of 2024, estates valued larger than $13.61 million for single individuals or $27.22 million for married couples are subject to federal estate taxes. The complexity of an estate tends to correlate with significant increases in wealth and assets. If you have recently come into a large windfall, bought or sold property, or accumulated significant wealth, it is a good idea to create or update your estate plan to ensure it accurately reflects your current situation and meets your needs. As you become wealthier, it is prudent to consider the asset protection and tax minimization aspects of estate planning to preserve your wealth so that as much of it as possible can be transferred to your loved ones. 

When You’re Facing Health Issues

When facing serious health issues, it becomes imperative to promptly create or update your estate plan. Having this responsibility[mk1]  taken care of can relieve stress for you and your loved ones during challenging times, allowing you to focus[AB2]  on your health and on spending time with those you care about. 

When You’re Nearing Retirement

The onset of retirement is a common catalyst for revisiting and updating financial plans, and estate planning is a crucial aspect of this reevaluation. By retirement age, it is likely that you will have grandchildren or other young people in your life you may want to include as beneficiaries in your plan. You may also want to update any health-care directives you made when you were younger to ensure they still accurately reflect your wishes. Additionally, you should check that any trusts you have created are funded in the way you intend, especially if you have acquired property or other assets that you have not yet accounted for. 


Ultimately, the best time to start estate planning is as soon as you recognize the need to do so. When you put off estate planning, you significantly increase your risk of dying without an adequate plan in place. If you match any of the criteria listed above, you should strongly consider meeting with a financial advisor or estate planning attorney to learn more about how to incorporate estate planning into your overall financial plan and what steps you should take to get started. 

The financial advisors at Business & Financial Strategies (BFS) have extensive experience helping their clients create and implement effective, strategic estate plans. A BFS advisor can help you ensure your wishes will be carried out so that your family will not have to endure unnecessary and preventable legal or financial stress. BFS advisors provide personalized guidance to help you make wise estate-planning decisions that align with your goals, needs, and financial plan. When estate planning, it is important to work with someone who understands the estate or inheritance laws that apply in your state. BFS has offices in the Iowa City/Coralville area; Kalona; and Fairfield, Iowa, and it serves clients throughout the United States. 

To learn more, please call 319-358-7700 or visit www.BFSFinancialPlanning.com to schedule a complementary twenty- to thirty-minute in-person or virtual initial conversation. 

Check the background of this firm/advisor on FINRA’s BrokerCheck.