When a physician begins his or her estate planning process, the physician will no doubt need to create a net worth statement. This statement will also need to include a listing of life insurance policies.
When you create your net worth statement, you will be listing all of your assets (including the cash, investments, real estate and other possession that you own) and all of your liabilities (any loans, mortgages and credit card balances that you need to pay). “Net worth” in this simply refers to the sum of your assets minus the sum of your liabilities. Your California estate planning lawyer might also refer to your net worth statement as your “balance sheet.”
As for some of the items on your net worth statement, you might not be certain of their exact values. For example, perhaps you have a valuable work of art, an antique or a piece of real estate that will require professional valuation services to determine what it’s worth. It’s okay if you don’t know the exact value of these items. What is most important is that you list all of them on your balance sheet. The more complete your list is, the more complete your estate planning will be. All of these items, for example, should be accounted for in your estate plan so that you can determine who will get what following your death.
As for life insurance policies, be sure that you get a copy of all of your life insurance policies. Knowing the payout on these policies will enable your estate planning lawyer and tax professional to determine whether your estate may need to pay federal estate taxes or incur other taxes.
Are you a physician looking to finalize your estate plan? Start getting your balance sheet ready and consider talking to a California estate planning attorney who can assist you in your planning.
Source: Physician Family Financial Advisors, Inc, “Physician Estate Planning Guide for 2017,” accessed Oct. 04, 2017