What is an estate?
An estate encompasses everything you own. This includes your car, home, checking and savings account, and other personal possessions. The common ground among these is that you can’t take them with you when you die. Estate planning includes planning in advance, which names who you would want to receive your things after you die.
What are estate planning tasks?
Some of the most popular estate planning tasks include:
- Creating a will
- Establish a guardian for living dependents
- Setting up funeral arrangements
- Appointing a power of attorney to direct other assets
- Provide family members with special needs without government benefits
- Provide the transfer of your business
- Instructions for the distribution of your valuables
Estate planning is an ongoing process. Your plan should be reviewed as your family and financial situation changes over time.
A will or a living trust?
A will provides instructions. However, it doesn’t avoid probate. The probate process varies from state to state. It can be expensive and includes fees such as legal fees, executor fees, and court costs. Assets that go through probate include anything that is titled in your name or controlled by your will. Not everything goes through probate, however. Any assets or property that are jointly owned is not controlled by your will. In this case, these possessions are transferred to the new owner.
A trust doesn’t need to die with you. Any assets in a trust can stay in your trust, managed by a trustee, until a beneficiary reaches the age you designated for inheritance. There are many reasons for a trust. Among these reasons include providing help for someone with special needs or protecting assets from someone who irresponsibly spends.
Who is estate planning for?
Estate planning is for everyone. We can’t predict how long we will live; illness and accidents happen. It’s good to be prepared.