Estate Planning 101: What You Need to Know
Death is inevitable, and while no one wants to think about it, it's important to prepare for it. This is where estate planning comes in. Estate planning is the process of preparing for the management of your assets and affairs upon your incapacity or passing. While it's not something most people look forward to, you'll be doing a huge favour to your loved ones by getting your estate planning done early. In this article, we'll walk you through the basics of estate planning, what you need to consider and how to get started.
You Have Control of Your Assets
One of the most significant benefits of estate planning is that it enables you to have better control and distribution of your assets. A well-planned estate can help reduce the chaos and confusion that can come with your passing. It also ensures that your wishes are respected and your assets are distributed according to your preferences. When you don't have an estate plan, the court will step in, and this means that your estate will be divided according to the law. This can lead to complications and conflicts if you have other plans.
You Have Less Confusion
Getting started with estate planning can feel overwhelming and confusing. There are several estate planning documents that you need, which include a will, a healthcare proxy, a durable power of attorney and a trust. These documents help avoid conflicts and enable you to have control over your assets, even when you're not around. A will, for instance, designates your beneficiaries and spells out how your assets should be distributed and how your affairs should be managed. A healthcare proxy, on the other hand, gives someone the power to make medical decisions on your behalf if you're incapacitated.
Staying Organised
Before you sit down to create an estate plan, you need to take stock of your assets and liabilities. This includes your properties, bank accounts, investment accounts, debts and insurance policies. Make a list of what you own, how you own it and who you want to pass it on to. This information will come in handy when creating your estate plan. It's also important to review your estate plan regularly, especially when you undergo major life changes such as a divorce, the death of a loved one or if you acquire new assets.
Consulting the Pros
When creating your estate plan, it's important to seek professional help from an estate planning attorney. An attorney can help you navigate the legal requirements and ensure that your estate plan is legally enforceable. An attorney can also help you review and update your estate plan to ensure that it aligns with your current situation. While it's possible to create your estate plan online using estate planning software, it's always recommended that you get professional help.
Reach out to an estate planning service near you to learn more.
