If you live your life to the fullest and make the most of all your opportunities, then perhaps planning your estate is the last thing on your mind. It may feel much more like what you do when you are nearing retirement and after the fun milestones like marriage and children. However, life is rarely, if ever, that predictable. The children may come before the wedding; in some cases, marriage and divorce may even come before the children. When these twists happen unexpectedly, you have little choice but to adjust and carry on. When it comes to planning your estate, you get to prepare for the significant inevitability.
Your estate consists of everything you own, such as your house or other real estate, vehicle, bank accounts, savings, life insurance, other assets, and personal belongings. An estate plan allows you to decide how these items are distributed to those you care for when you die. It organizes your affairs and records your wishes and intentions in writing.
Also, having an estate plan can protect your loved ones from undergoing the complex probate process. It refers to a legal proceeding wherein an estate is administered and settled according to the intestate succession laws in the decedent’s state if there’s no will. But, if your estate needs to undergo probate, your executor or heirs should work with legal professionals to represent them in the said judicial proceedings. An experienced lawyer can easily navigate complicated probate and achieve a more favorable outcome.
On the other hand, there are several benefits to planning your estate. First, it allows you to put plans to make things a bit easier on your loved ones. Estate preparation also helps you escape taxation and legal tie-ups while ensuring that your assets are distributed according to your wishes. An estate plan even names the individuals who will take care of your minor children and who can make medical decisions on your behalf if you cannot do so for any reason.
If you are on the fence about taking a step like this now, imagine what might happen if something happened to you and you were forced to make all these decisions while being ill? Apart from all the stress you might experience at the moment, just by your health and mental state, you would be more likely to make unwise, hasty, and erroneous decisions under such circumstances. For that reason, in particular, it is much better to make those kinds of decisions when you are at your best.
Getting life insurance does not mean you are about to die tomorrow. Similarly, making an estate plan does not hasten the inevitable. But bear in mind that an estate plan is only helpful if you keep it up to date. Regularly review your plan, especially after significant life events such as marriage, divorce, or family death. Changes in tax laws or other financial policies should also be considered. Your heirs may still face some of the issues you worked so hard to avoid if your estate plan is out of date.
If you are not sure how to get started, some institutions are in place to help walk you through estate plan basics. The process does not have to cause you much discomfort, and if you can’t start putting plans in place right now, the best approach is to get started as soon as possible.
But, if you need help in creating an estate plan as soon as possible, you can consider the following tips:
- Create an inventory of all the things that compose your estate. For example, walk around your home and list down all the personal properties. Also, don’t forget to include your actual properties and other assets you own in your inventory.
- Make a list of all your debts to determine what needs to go into your estate plan and needs to be disposed of to settle your debts.
- Use the proper estate planning strategies, such as drafting a Will, setting up a trust, and buying insurance coverage. Then, depending on your situation, you can take advantage of the strategies mentioned above as part of your estate plan. Once you determine which one is right for you, complete the documents as early as possible to ensure your loved one’s protection in case of death or incapacity.
Estate planning can be an important way of ensuring your loved one’s financial future if something wrong happens to you. Hence, if you haven’t started yet, keep the information mentioned above in mind to be properly guided in writing your estate plan.