An estate plan is a set of legal documents that can be used to distribute your estate after you die. It includes what happens to your assets and who gets them, and it also includes the legal decisions that will be made for you once you die.
An estate plan is important because without one, state law will dictate what happens to your estate. You may not agree with how some states distribute estate assets, which means you need a plan that will work for your estate and the people who depend on it once you are gone.
You will need a reliable trust lawyer to help you write your estate plan. Your lawyer will work with you to draft a set of documents that is right for your family and estate. This way, you will be confident that everything will be taken care of in the way that you want even after you pass away.
Estate Planning is Essential
An estate plan is important for everyone, but especially for people who have young children or dependents who look to them to support their needs. Without a properly written estate plan, your loved ones could end up fighting over money and assets once you are gone. This can cause unnecessary stress on those closest to you.
In addition, estate planning protects your estate from unnecessary taxes and fees that could be levied against it if there is no plan in place. This can also ensure that your wishes are followed to the letter when you cannot speak for yourself anymore after a serious illness or accident has taken hold of you.
Estate Planning Basics
An estate plan generally consists of a will, estate planning trusts, and powers of attorney. A last will and testament is one of the most important estate documents you can leave for your loved ones after you are gone.
A properly written will outline who gets what when you die. It also provides instructions on how to distribute assets in case there is no clear beneficiary or if beneficiaries are minors. Determining who gets what in case of the absence of a will is done under estate administration, which can be very costly and time-consuming.
Estate planning trusts come into play when there are certain assets that need to pass on to other beneficiaries or if you do not want them included in your estate plan at all (such as insurance policies and retirement accounts).
An estate plan also takes care of the people who would be in charge of your minor children if you were to die unexpectedly. In some states, a court-appointed guardian must oversee estate matters for minors under 18 years old and may even have access to their bank accounts. This can make things both difficult and complicated especially if you are not around to explain the estate plan.
Having an estate plan will allow you to decide how much control over your estate you want even after your death. Below are the steps on how you can start making an estate plan:
Create an inventory of all the things you own
You need to create a listing of all your assets, which includes bank accounts and investments. You should also include things like real estate or vehicles that you own in the estate plan. This is important because it will allow for easier determination if there are any probate issues when it comes to dividing up your estate.
Create a contingency plan
A contingency plan includes all the things that you want to do if something were to happen. This includes who will take care of your estate and what needs to be done in order for them to make those decisions on how it should be divided up after your death. A contingency plan is important because it will allow your estate to continue without any issues after you die.
Create a letter of instruction
A letter of instruction is basically like an extended contingency plan and it includes how you want the estate handled if something were to happen to you. This means that you will need to state who you want in charge of your estate, where everything is located, and other important information. This letter should be read by your estate executor so that they can effectively handle your estate after your death.
Estate planning offers a lot of benefits to those who want to make sure that everything is taken care of when they die. Through estate planning, you can make sure that your estate goes to the people you want it to go to after your death. You will also be able to give clear instructions on how things should be handled in case something were to happen, which is why estate planning needs to be prioritized.