Financial Advice

Manage Your Finances


Estate Planning

It’s always good to have a plan. Clint Campbell, CFP®, Financial Advisor (CUSO Financial Services, L.P.* at UFCU) joined KXAN in the studio to help us with estate planning.

What is estate planning?

Estate planning is a catch all phrase that refers mainly to transferring assets to the next generation, but it can also involve planning for incapacity or prolonged illness. For those with substantial wealth, an estate plan may involve strategies that help reduce the estate and gift taxes.

Who needs an estate plan?

Most everyone needs at least some basic estate planning. For those with young children the need is more crucial. Part the estate planning process to make sure that your spouse or children are cared for properly after you’re gone or in the vent you become unable to provide for them. For example:

  • You may want leave assets to a family trust rather than outright to your children, especially if they are minors or have bad financial habits.
  • You need to have selected a guardian for your children if you and your spouse pass away unexpectedly. It’s rare but it does happen.
  • You need to select the person that will make decisions regarding your medical care or financial matters if you are not able to.

Many of us underestimate the size of our estate. If you have substantial life insurance or have equity in your home, you may be surprised at what your estate could potentially be worth. Estate planning is not just for wealthy people.

How do I create my plan?

The important thing is to have a plan in place, in the form of a will and/or a trust and other documents in the event that you pass away unexpectedly or you become incapacitated. Most estate planning attorneys offer a bundled package of estate planning documents such as wills, trusts, advanced directives, medical power of attorney, durable power of attorney, etc. I recommend working with an experienced estate planning attorney. It will cost more than the do-it-yourself online approach but you’re going to get a properly designed and executed plan in place. You need to review your plan as your circumstances change, it’s not a once and done thing.

Even if you have no plan, you have a plan. It’s called the probate process. The probate process in Texas follows certain guidelines as to who gets what. Your wishes on how things are distributed are irrelevant, since you did not make them known in a will.

Ways to avoid probate include trusts, beneficiary designations on your IRAs, 401(k)s and annuities, as well as joint ownership. It’s important to consider all of these options in the context of a comprehensive estate plan since a mistake in one area can undermine your primary estate planning goals.

* Non-deposit investment products and services are offered through CUSO Financial Services, L.P. ("CFS"), a registered broker-dealer (Member FINRA/SIPC) and SEC Registered Investment Advisor. Products offered through CFS: are not NCUA/NCUSIF or otherwise federally insured, are not guarantees or obligations of the credit union, and may involve investment risk including possible loss of principal. Investment Representatives are registered through CFS. UFCU has contracted with CFS to make non-deposit investment products and services available to credit union members.