Making your Legacy Live On: Discover the Right Estate Planning Technique

Let your loved ones preserve and grow the wealth you’ve worked hard for all your life. If, by any circumstance, you happen to juggle being a businesswoman and family woman, you would eventually want to pass on your business and ensure your family lives a comfortable life.

The last will and testament often come to mind when discussing estate planning. This document stating the heirs and property distribution, however, needs to be validated by the court. Furthermore, it is only part of the equation.

How one’s assets will be transferred is among several topics to be addressed in estate planning.

Simply allocating your properties without proper planning and expert advice could burden your heirs with estate taxes and applicable obligations. For starters, the estate tax is 6% of the net estate since the Tax Reform for Acceleration and Inclusion (TRAIN) law was implemented. This has to be paid within a specified period.

Different rules and requirements also govern the handover of a specific property or asset. For example, transferring a real estate property such as an ancestral house to heirs is different from transferring stocks and bank accounts.

Consider beginning your succession plan as soon as you have amassed real and personal properties of considerable value. This will give you enough time to explore your options and set things in order. Remember: There’s no minimum wealth requirement to get started on these matters. Starting as early as you can will help your estate planning be as smooth as possible.

Here are some of the steps you can take to help make transferring an estate a lot more seamless:

1. Life insurance. An insurance product designed for its intended purpose may be the most efficient way to leave a legacy.  

Asset Master, an insurance-investment plan offered by AXA Philippines, helps ensure your loved ones enjoy the lifestyle you’d want for them even if you’re no longer around. Aside from the speedy release of the death benefit, proceeds from the insurance payout of irrevocable beneficiaries are tax-free. This disbursement may be used immediately to cover expenses related to the burial and transfer of titles.

Asset Master allows you to invest in local and global funds and maximizes your plan’s earning potential. These funds include but not limited to, Peso-Denominated Dollar Funds, Global Assets Income Paying Fund, and Global Dynamic Allocation Funds.

2. Distribution of liquidated properties. Some estate owners may consider selling the properties (real estate, vehicles, and other valuable possessions) while they’re still alive to ensure that the seamless allocation of the properties is carried out in their presence. Instead of estate tax, though, other obligations such as capital gains tax and donor’s tax should be considered when going with this route.

Note that these are initial suggestions only. A topic as intricate as estate planning, of course, needs the guidance of an expert to spare your heirs from possible headaches, disputes, and unnecessary costs arising from a poorly planned estate succession.

Know you can game plan your legacy today. Call an AXA financial advisor to know more about the right tools for planning your estate.