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LEAVING THE LEGACY YOU WANT PRESERVING YOUR WEALTH AND YOUR WISHES You've worked hard to build your wealth and provide for your family. To be confident that the legacy you envision will become a reality, it's critical to establish and maintain an estate plan. But even comprehensive planning isn't enough. One of the most important things you can do is to talk to your family about your estate plan. A recent survey revealed that families are much happier and more satisfied when parents include children in their planning process. 1 Given this backdrop, let's look at a few of the core elements of any estate plan: • A will. Your last will and testament directs the distribution of the property you own directly upon your death. (Some assets pass outside of a will, based on operation of law or titling, such as a joint account with rights of survivorship or an IRA through a beneficiary designation; therefore, correct titling of assets is essential.) A will also names an executor for your estate and guardians for any minor children. • Advance medical directives. Advance directives speak for you, should you become incapacitated. A healthcare proxy appoints an individual to make medical decisions for you if you are unable to communicate. A living will states your wishes with respect to end-of- life medical treatment. • Power of attorney (POA). This authorizes someone to make business or legal decisions on your behalf. You can make your power of attorney effective immediately upon signing or, in some states, only in the event of your incapacity. HELP REDUCE YOUR TAXABLE ESTATE THROUGH GIFT GIVING A common objective of most estate plans is to minimize taxes and preserve as much of your estate as possible. Gifting assets to your beneficiaries during your lifetime is a popular estate planning strategy, designed to transfer property from your estate to help reduce potential future estate taxes. But "giving while living" also serves another important goal: sharing cherished experiences with your children and grandchildren. The federal government imposes transfer taxes on estates over a certain threshold.2 The exemption amount for 2015 is $5.43 million. The rate for all transfers by gift or at death, in excess of the exemption amount, is 40%. Some popular gifting strategies are: • Annual exclusion gifts. Each year, you can make certain annual gifts that don't use any of your lifetime gift tax exemption amount. This year, the gift tax annual exclusion B Y A N T H O N Y C R I S T I A N O VUE ON FORTUNE V U E N J . C O M 120

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