The Melting Effect of Rising Rates on Estate Planning

From the Oxford Financial Group

By Julia Weaver and Scott Simons, both of Oxford Financial Group

As Sir Winston Churchill observed, after every period of delay and procrastination comes a period of consequences. While we are in this era of historically low-interest rates, it is wise to consider the potential cost of delaying certain estate planning strategies.

The Freeze Before the Melt
An estate freezing strategy seeks to “freeze” the taxable value of a family’s estate, or certain assets, so that future appreciation avoids the 40% estate tax. Through freezing strategies, this appreciation grows outside of the taxable gross estate, allowing the family to retain 100% of their future wealth appreciation, rather than only 60% after netting out the estate tax.

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