While setting up a will and trust are important parts of estate planning in Maryland, getting your investment portfolio ready is another piece of estate planning you should not overlook.
As we get older, our finances typically become more complicated and can be difficult to keep track of. Simplifying your investment portfolio or transferring management of the portfolio to someone else are two estate planning strategies to consider.
Simplifying
Simplifying involves consolidating all investments and financial accounts to one or two banks or financial service companies. Imagine how much easier distributing your assets could be if your financial accounts were all in the same place.
Many of us open and close accounts at various financial institutions throughout our lives or end up with several investment accounts as we move between jobs. Estate administration can be a nightmare when it involves trying to track down several accounts and several financial institutions.
Additionally, money scattered between various places increases the chance that some may be missed. Having all investments in one place reduces the risk of missing an account that could be distributed to a family member.
You might also consider modifying investment strategies. If you have complex investments that require specialized knowledge or skill to manage, changing to more simple investment forms mean your loved ones without investment knowledge will not be left confused over how to manage a complicated investment they inherit.
Transferring management
Another option is to transfer management of your investments to someone else. This process should be slow and methodical.
Choose someone you trust to manage your finances and who you expect to still be around after you pass away. It can be a family member, friend or investment professional. Having someone who understands the investments ensures a smooth transition when they are transferred pursuant to a will.
Both these choices have benefits. It makes it easier for you to keep track of your investments as you age and reduces the chance of confusion and conflict as your estate is distributed after you pass away.