How Estate Planning Fits in a Comprehensive Financial Plan

While “comprehensive financial planning” may not be an every-day term and a concern for everyone, “estate planning” typically is. For the most part, people know what estate planning is, how important it is and what can happen if they don’t have the proper planning in place. But here’s the catch: Estate planning should be a part of a person’s overall comprehensive financial plan. And the right financial advisor should be able to assist you with these concerns, either in-house or through an estate planning attorney.

Another misconception many people have is that estate planning only deals with issues after you pass away, but there are other considerations that should be discussed. For example, clients of all ages should address the problem of potential incapacity due to physical or mental disability. Who do you want to make decisions for you if you are no longer able to care for yourself? And how do you want that care to look like? How do you want it paid for?

Estate planning can be viewed as two separate, major areas that need to be addressed.

Economic/Financial Issues

  • Have you taken the steps necessary to minimize the taxes that your estate will owe the federal (and potentially state) government? Reducing and eliminating estate taxes will allow you to pass on more money to your children and heirs.
  • Do you have sufficient resources (investments, life insurance) to support your family in the event of your untimely death?
  • Is your estate sufficiently liquid to meet the cash needs of settlement after you pass away?
  • Are you comfortable with your beneficiaries (particularly if they are your children) inheriting their share all at once?

Non-Economic Issues

  • Do you have a will?
  • Who will be responsible for your children?
  • Have you stated your wishes with regard to the use of life-prolonging measures? If not, you may need to consider a living will or a health-care proxy.
  • Have you established a Power of Attorney? Is it a general Power of Attorney or a “springing” Power of Attorney?
  • Have you considered the pros and cons of a revocable living trust versus court-supervised probate?

Comprehensive Financial Planning 

Financial Freedom provides comprehensive financial planning, asset allocation and investment management services, of which estate planning is an essential part.


Ready to get your affairs in order? Contact Financial Freedom to see how we can help with all your financial planning needs.


A Real-Life Example

We can discuss estate planning in detail, but here’s a real client experience that may also shed some light on proper comprehensive financial planning.

Take our clients “Bob and Sheri.”

Bob just turned 70 and his wife, Sheri, was 68 when they first came to see us. Both were retired from the corporate world and wanted to know the best way to generate their desired retirement income. With longevity in both families, they worried about running out of money and wanted to know how best to manage their retirement required minimum distributions that start at age 70-1/2. With three daughters and five grandchildren, the couple also wanted to ensure they had an appropriate estate plan in place, implementing a charitable or family gifting strategy. 

Bob and Sheri were looking for a financial advisor who would add value to their lives and put their interests first. And they wanted to work with someone who was able to address all of their planning needs until the end.

We were able to put a comprehensive plan in place for them.

Warning: If You Don’t Have an Estate Plan in Place, the Government Does

Comprehensive financial planning is crucial. And the truth is, if you don’t have a solid plan in place, the state in which you live in has one for you.

My guess is you won’t like it.

For example, if you haven’t appointed someone to handle your assets and you suddenly become disabled and can no longer do this yourself, a court will have to take over for you; not your family.

If you pass away without a comprehensive estate plan, what you are able to leave behind will be distributed according to federal and state laws; not by your family.

Sadly, many people procrastinate putting an estate plan in place. It may be an uncomfortable discussion to have. It might be overwhelming if attempting to do it yourself. It might be because someone doesn’t think they have enough value to worry about. Then, when something does happen, it falls on the person’s family. Often times this is the children.

When family is already dealing with the loss of a loved one, adding financial burden can be detrimental.

Getting Help 

Working with a financial advisor who provides comprehensive financial planning is a good option.

Here are just a few reasons why:

  1. Estate planning determines who will inherit what assets, and these assets may include retirement accounts, annuities and life insurance.
  1. Many people choose to designate their trusts as beneficiaries of their retirement plans. There can be pros and cons to this.
  1. Estate plans should be updated as your life and family dynamics change. Do you have another child who was not considered when your estate planning was originally set up? Has there been a death, divorce or marriage? Are your retirement plans the same or have you started a new job?
  1. At Financial Freedom, comprehensive financial planning is based on each client’s personal goals. Have they changed?
  1. A comprehensive financial plan should also take into consideration some major costs that you foresee, such as children’s education, weddings and possible grandchildren. When a financial advisor can look at a client’s entire financial package, an investor has a better chance of reaching their long-term goals.

Financial Freedom LLC has client relationships that span generations. We focus on a comprehensive financial planning approach and value a long-term client-advisor relationship. If you’re interested in getting your financial affairs in order, contact us to see how we can help.


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Filed Under: Comprehensive Financial Planning