Pillar Guide
Estate Planning: Protect Your Legacy
Author: Brett R. Henderson, CIMA®, CPFA®, CRPS®, CEPA®, AIF®, CLU®, BFA™
Last Updated: October 2025
Chartered Life Underwriter | Estate Planning Specialist
Quick Answer
What is estate planning?
Estate planning is the process of organizing your financial affairs and legal documents to is designed to help support an asset structure that are distributed according to your wishes after death, while minimizing taxes and legal complications for your heirs. It includes creating wills, trusts, powers of attorney, and healthcare directives.
Why Is Estate Planning Important?
According to a Gallup survey, only 46% of U.S. adults have a will. Without proper estate planning, your assets may be distributed according to state intestacy laws rather than your wishes, potentially causing family conflict and unnecessary taxes.
Essential Estate Planning Documents
Last Will and Testament
Directs asset distribution and names guardians
Revocable Living Trust
Avoids probate and provides privacy
Durable Power of Attorney
Authorizes someone to manage finances
Healthcare Directive
Specifies medical treatment preferences
Healthcare Power of Attorney
Names someone to make medical decisions
Beneficiary Designations
Updated designations on all accounts
What Is the Difference Between a Will and a Trust?
A will is a legal document that takes effect after death and must go through probate court. A trust is a legal entity that can hold assets during your lifetime and transfer them to beneficiaries without probate. According to the American Bar Association, trusts offer several advantages:
- Probate Avoidance: Assets in a trust bypass the public probate process
- Privacy: Trust contents remain private, unlike wills which become public record
- Incapacity Planning: A trust can manage assets if you become incapacitated
- Control: Specify exactly how and when beneficiaries receive assets
How Can I Minimize Estate Taxes?
For 2024, the federal estate tax exemption is $13.61 million per individual($27.22 million for married couples). While most estates won't owe federal estate taxes, state estate taxes and income taxes on inherited retirement accounts can still apply.
Estate Tax Minimization Strategies
Annual Gift Exclusion
Gift up to $18,000 per person annually without using lifetime exemption
Charitable Giving
Charitable trusts and donations reduce taxable estate
Irrevocable Life Insurance Trust (ILIT)
Removes life insurance proceeds from taxable estate
Spousal Lifetime Access Trust (SLAT)
Transfers assets while maintaining some access for spouse
What Are the Biggest Estate Planning Mistakes?
- Not having a plan: Dying intestate leaves decisions to state law
- Outdated beneficiary designations: These override your will
- Not funding your trust: An unfunded trust doesn't avoid probate
- Forgetting digital assets: Include online accounts and cryptocurrency
- Not planning for incapacity: Powers of attorney are essential
"Estate planning isn't just for the wealthy; anyone with dependents, property, or retirement accounts needs a plan. I've seen families spend years in probate over estates worth $200,000 because there was no trust in place. The cost of a proper estate plan is a fraction of what your family will spend in legal fees and lost assets without one."
Brett R. Henderson, CIMA, CPFA, CRPS
Fiduciary Financial Advisor, SWE90, CLU-certified legacy planning advisor
Revocable Trust vs Will: Which Do You Need?
| Feature | Revocable Living Trust | Will Only |
|---|---|---|
| Avoids Probate? | Yes | No, must go through probate |
| Privacy | Private document | Public record after death |
| Cost to Create | $1,500 - $3,000+ | $300 - $1,000 |
| Incapacity Planning | Built-in successor trustee | Requires separate POA |
| Ongoing Maintenance | Must fund/update the trust | Simpler to maintain |
| Best For | Homeowners, complex estates | Simple estates, young adults |
Related Resources
Frequently Asked Questions
What is estate planning?
Estate planning is the process of organizing your financial affairs and legal documents to is designed to help support an asset structure that are distributed according to your wishes after death, while minimizing taxes and legal complications for your heirs.
Do I need an estate plan if I don't have a lot of assets?
Yes, everyone needs basic estate planning documents regardless of wealth. At minimum; you need a will to designate guardians for minor children, a healthcare directive for medical decisions, and a power of attorney for financial matters.
What is probate and how can I avoid it?
Probate is the court-supervised process of validating a will and distributing assets. You can avoid probate by using revocable living trusts, joint ownership with right of survivorship, payable-on-death designations, and proper beneficiary designations.
How often should I update my estate plan?
Review your estate plan every 3-5 years or after major life events such as marriage, divorce, birth of children, death of beneficiaries, significant changes in assets, or moves to a new state.
What happens if I die without a will?
If you die without a will (intestate), state law determines how your assets are distributed, which may not align with your wishes. The court will also appoint a guardian for minor children without your input.
Start Your Estate Planning Journey
As a Chartered Life Underwriter (CLU®), Brett Henderson helps clients create comprehensive estate plans that protect their families and legacies.
Schedule an Estate Planning ReviewDisclosure: This content is for educational purposes only and does not constitute legal or tax advice. Estate planning involves complex legal issues that require consultation with qualified attorneys and tax professionals. Brett R. Henderson is a registered representative offering securities through Vanderbilt Securities, LLC, Member FINRA/SIPC.