Estate planning can help you deal with the complexities of a military, civilian and Social Security benefits and take a burden from your loved ones
Estate planning is an activity most people prefer to avoid. They don’t want to think about why they are doing. However, if you look at it from the perspective of the positive benefits of having a comprehensive estate plan, it may seem less of a burden.
We all know why it must be done. Death and taxes, they say, are inevitable, and estate planning can help deal with both of those issues. It cannot prevent your death, but it confers a great number of benefits to your family and that is the real reason for doing it.
Most people understand a will and how it is the legal instrument that distributes your assets upon your death. Less well understood is how trusts can be used for a variety of purposes, from wealth preservation and transfer and tax planning to the protection of children of your first marriage.
An estate plan tailored to your needs
No two estate plans will look exactly alike because the property and family structure for every individual will be different. Nevertheless, the basic outlines will be similar. You will want a will, perhaps to transfer personal property to select individuals. You may need a trust or a set of trusts that will provide for the easy transfer of assets to your children or grandchildren and work to minimize the tax burden on the estate.
You may need other advance directives, such as a “living will” or various powers of attorney, to ensure that your affairs can be managed should you suffer some form of incapacity.
Your estate plan may be basic and straightforward or it can become quite complex, depending on the specifics of your situation. For instance, if you served in the military at one of the numerous installations in the Northern Virginia area, completed your 20 years and now you are eligible to receive a base pension benefit.
Then you worked for a private defense contractor in the area and you put in another 20 years or so, and will receive a pension from that employer. While you were there, you also funded a 401k retirement plan. During this time, you were also paying into Social Security, and will receive a benefit from that program.
Multiple incomes for retirement
This could leave you with four income streams after your retire. Without planning, you could find yourself subject to substantial taxes from all of that income. With a comprehensive estate plan, you gain a perspective on what your retirement may look like financially, and may be able to direct investments in ways that will prevent excessive tax burdens from developing.
Military pensions are a tremendous benefit, but you want to have a clear picture of how all of your assets will work together to ensure you are able to fully enjoy the fruits of your many years of service and labor.
In addition, if you have been divorced, that can add significant complexity to your estate planning as it is possible that a spouse is entitled to some portion of your military pension. If this is the case, you want to be certain you understand exactly how that will work once you retire.
By working with an experienced estate planning attorney who understands how the elements of elder law, estate planning, family law and military veterans fit together, you can obtain the estate plan that will ensure your wishes and meet your needs.