A Child’s
Guide to Eldercare
Financial
Issues
The importance of financial and estate
planning
Every person who has earnings and properties
should engage in financial planning to make sure that these earnings and
properties are invested properly during and even after the lifetime of the
owner. Proper financial planning would help a person live a comfortable life
later on when he is no longer strong enough to fend for himself.
Financial planning is the process or method of
knowing the total income and assets of a person and then planning for their
utilizations, purchase or distribution in the future.
Financial planning can help in the preservation
and income generation of earnings and properties. Thus, it is very important
that every person is aware of the extent of his earnings and assets so he would
know how to handle them after his retirement and even after death.
Every income earner should resort to financial
planning especially for retirement purposes. People who are about to retire but
who have not prepared for their retirement finances face a very big problem
especially with regards to how they would take care of themselves. Of course,
there are pension plans which can provide a monthly or annual income for
retirees. But what about those who do not have a pension plan—how can they
survive when they no longer have a regular income?
Some people plan for retirement at a time when
they are still strong and are able to make wise financial decisions. Some of
these people have invested their money into retirement plans which will enable
them to visit places they have never been to and to do things they did not have
the time to do when they were still working.
But financial planning is not just for
retirement purposes only. Death is the only thing certain in this life and
every person should prepare for such eventuality. If a person has dependents or
beneficiaries then he should name them in a will so that when his time comes,
everything would be in order. This can be made possible through proper financial
planning.
A person should make sure that he has a will to
avoid quarreling between his dependents and beneficiaries at the time of his
death. Families usually forget blood relations when it comes to finances so it
is better to leave something for everyone and to make this legal and documented
through a will.
The law provides that the legal heirs of the
deceased should get their legal shares first before the deceased can leave
something for the other beneficiaries named in the will. The law has provided
that a percentage of the estate of a person should go to the legal heirs. That
portion of the estate that has not been appropriated by law for his legal heirs
can be distributed to other people according to the wishes of the deceased.
The estate of a person refers to his entire
property or assets including cash, pending income, real estate and other
properties like appliances, vehicles, and household fixtures.
When a person plans for his estate, he
apportions his properties to his beneficiaries. While the will is made during
the lifetime of the deceased, it can only be passed on to the beneficiaries
after his death. A provision which passes on the estate of the deceased to his
beneficiaries while he is still alive can be questioned as it can be considered
a donation inter vivo. This can be a good strategy as it can exempt the gift
from estate taxes later on. However, some donations are prohibited so better
check with the lawyers first.
People used to consider the act of making a
will when they are still alive as something gruesome. However, practicality
requires that a person should plan his estate by making a will while he is still
capacitated and strong enough to decide as to which properties should go to this
or that beneficiary.
Financial and estate planning should be
considered an essential undertaking of every person who wants to plan ahead for
his life. It may take some time to do this but there are lawyers and financial
planners who offer their services for a flat fee. It may be time consuming for
a busy person but the benefits he and his dependents derive from financial and
estate planning makes the time well spent.
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Eldercare News:
MSN
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Google
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Yahoo!
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