Deborah L. Jacobs just published the 4th edition of her widely recognized book “Estate Planning Smarts”.
Thoughtfully and thoroughly Jacobs bridges the gap between abstract theory and practical application on a subject very few of us like to think about – which I guess is why about half of American adults with children have not made a will! According to Jacobs, the book is not designed to replace an estate attorney – but rather to give us background and context before meeting with one.
Out of the gate in chapter one, Jacobs sets the tone by imploring us to draft the 5 “Essential Documents”:
- Durable power of attorney(s)
- Health Care Proxy(s)
- HIPAA release(s)
- Living will(s)
Do you have these documents in place? If not, it’s a good idea to find an attorney and get them drafted – it could save your loved ones a lot of time, money and difficulty.
Chapter 3 enlightens us how recent changes in tax law have helped: We can currently transfer 5.43 Million during lifetime or death before either gift or estate taxes kick in (known as the applicable exclusion). However… a quirk that complicates planning today is that (at last count) at least 19 states have state estate tax on top of the Federal.
And in many states the state tax exemption is not unified with the federal. Jacobs reminds us that this requires careful and creative planning and several ideas are described in the book. Separately, the folks at PRW wealth management have put out a nice chart to find out what the 2015 exemption is in your state – which can be found here.
There is a lot more in the book covering: trusts, retirement accounts, life insurance, gifting, creditor protection etc.
In the end the best approach is probably to hire a financial advisor – along with an estate planning attorney – but for those who like to start with books, I have found none better on the topic of estate planning than Estate Planning Smarts by Deborah Jacobs.