Estate planning may not be the most comforting thing you have to do as an adult, but it’s very necessary to ensure your assets are dispersed correctly. This isn’t something you want to put off. Below we have compiled a list of the three most important things you should know about estate planning.
1. Estate Planning Is Not Just For The Wealthy
“Anything you personally own is considered your estate, and this includes both tangible and intangible assets,” said The Andrews Law Firm, P.C. Tangible assets are those possessions that you can physically touch, such as your vehicle, gun collection, or clothes. Intangible assets include those which you cannot physically touch, such as an IRA or your checking account.
All of these assets should be dispersed to the heirs you assign in your will. It’s a good idea to take some time to list out all of your assets before starting the estate planning process. This will help to make the process more streamlined and less stressful along the way.
2. An Estate Plan Is More Than Just A Will
An estate plan is a grouping of legal documents that speak on your behalf after you pass or when you are incapacitated. These documents include the following:
This document specifies who your heirs are. It will detail which heirs get which assets, when they get them, and how they will get them. A will is highly unique to the individual.
General Power Of Attorney
This document appoints a person or persons which are to take care of your financial needs when you are incapacitated.
Healthcare Power Of Attorney
This legal document designates a person or persons who are to make healthcare decisions on your behalf if you’re unable to do so.
Advance Directive For Healthcare
This document outlines your wishes of which decisions you would like to be made regarding your health care if you are incapacitated.
When preparing your estate plan all of these documents should be included. Before sitting down with your estate planner it’s a good idea to decide on these issues ahead of time. In addition to your assets list, you should also have a liabilities list. This will help to instruct persons on what to do with your finances to ensure all liabilities are paid off and not passed down to your heirs.
3. If You Don’t Have A Plan The State Government Will
When an individual doesn’t take the time to decide what happens to their estate, the State Government will step in and disperse the estate following their terms. This means the Government will control who gets your assets, what assets are sold to cover your medical expenses if you’re incapacitated, and who will become the guardian of any of your children who have no alternative legal guardian.
Seeking the help of a professional estate planner will allow you to draft your intentions for what is to happen in all these types of situations. Don’t rely on the cheaper online do-it-yourself versions of estate planning as they may miss these key areas which can drastically impact you and your loved ones in the future.
Taking the time to develop and estate plan will benefit you and your kin. However, it’s important to remember to consistently update your plans as your life changes. Your estate planner should be contacted when you obtain new assets, change your family structure, and during any other changes in living arrangements. Keeping your estate plan current is the key to ensuring what you want to happen in the future actually happens.