Getting your ducks in a row, an endof life necessity

We are living longer. With advances in medicine and health care, we are more informed about best practices for diet, exercise, stress reduction, and safety— all elements that contribute to our longer life span. But no matter howy oung we feel now, planning for our eventual aging by getting our proverbial ducks in a row, especiallywhen it comes to estatemanagement plans, is critical. When planning for end of life financial strategies, it is imperative to be prepared for the unexpected.

First and foremost, for those investors considering the best method of passing on their wealth, this means taking a proactive approach to truly knowing and understanding what youwant to do with your estate. Do youwant to pass wealth on to your beneficiaries, or donate to charity, for example? These objectives can be achieved by good planning and the preparation of the proper directives under applicable state law.

In addition, identify the people around you whom you would trust to manage your assets andmake decisions on your behalf, such as designating the person to act

as your agent under a Power of Attorney. Once you’ve identified these people, share this information with your family.

Once you know what you want to do with your assets, and whom you are designating to carry out your wishes, work with a legal adviser and your financial adviser to decide the best tool for you to transfer yourwealth.

One option is to establish a trust for your estate. You, the “grantor,” names a trustee who will either maintain the assets in trust or distribute your assets to one or more “beneficiaries” upon your death. (The assets for a minor would generally remain in trust until the beneficiary attains the age of majority.)

Trusts can be set up not just to transfer wealth to your heirs, but also for charitable gifting options. With Charitable Lead Trusts (CLTs), the charity of your choice receives a portion or all of the income interest, and your beneficiaries would receive the payout at the end of the trust. For Charitable Remainder Trusts (CRTs), beneficiaries receive the in come interest, and the designated charity receives the payout at the end of the trust.

Trusts can be revocable or irrevocable. A revocable trust, or living trust, lets the you, the grantor, make revise or terminate the trust. After your death, a revocable trust becomes an irrevocable trust. An irrevocable trust cannot easily be changed or a mended. With an irrevocable trust, you control the plan for how you

want your assets distributed after your death. You may want to talk with your familymembers ahead of time to determine howto disseminate the assets. Assets can also be sold throughthe trust with the proceeds distributed accordingly.

Many of us see the value in discussing plans for our finances in the case of an untimely death or unforeseen circumstance. Still, some of us find it difficult to have discussions that evoke sadness and grief, and delay talking about these issues until it is too late.

Yet, by having these discussions ahead of time with our lovedones aswell as our financial planner and other professionals, we can avoid having tomake, or having others make, decisions at times of extreme stress.

All of us should be sure we have our ducks in a row when planning the future of our estate. That way we will be assured of an easy glide to get towherewe are going.

Craig R. DeMaio, a Stamford resident, is a Financial Advisor with the Wealth Management Division of Morgan Stanley in New York, NY. He is a cofounding partner of the 1290Discovery Group at Morgan Stanley, https://fa.morganstanley.com/1290discoverygroup/. He can be reached at 2127054590 or by email at craig.demaio@morganstanley.com. The information contained in article is not a solicitation to purchase or sell investments. Any information presented is general in nature and not intended to provide individually tailored investment advice.