Estate planning refers to designating what should become of your assets and liabilities upon your demise or if you become incapacitated. Remember that to plan your estate; you do not have to be wealthy. Estate planning is advantageous in many ways such as caring for the needs of your loved ones and ensuring continuity of business transactions. You can consult an estate lawyer to help you through the process. In the meantime, here are the major steps of estate planning.
Write an inventory of your assets and liabilities
You ought to compile a detailed list of what you own and what you owe. Ensure you reveal the contact details of your creditors as well as the location of your assets. The list should be kept in a secure place- where you keep other crucial documents. Give a copy of this list to your executor.
Have an eventuality plan in place
Would your family be catered for financially in case you became incapacitated? Such are the questions you should have in mind when developing a contingency plan. Consider insurance policies such as disability insurance. The emergency plan should ensure your family’s well-being in case of any uncertainties.
Consider your children and dependents
Most people choose to leave their wealth to their spouses; which is entirely okay. However, if you have other dependents such as kids from a previous relationship, it is advisable to address their needs exclusively. Other dependents could be siblings, relatives or someone with special needs.
Guard your assets
After leaving this world, many people have plans for their estates. Some want their heirs to inherit the wealth and live comfortably while others want the property to be donated to charity. Whichever the plan, protect your assets through outlining strategies such as disposing or transfering business ownership. Many individuals utilize trusts and life insurance for this.
Put your wishes on paper
Make sure your wishes are executed by creating the required legal documents such as an updated will to dispose of your assets, power of attorney for the sake of financial matters and a living will specifying your last wishes. Also, confirm beneficiaries for your retirement accounts, insurance policies, and other possessions.
Appoint fiduciaries
By the time your wishes are being fulfilled, you will be in a state where you cannot manage your assets. This is because your desires become valid either when you are incapacitated or when you are dead. Therefore, you need someone to execute these wishes. You need a trustee of your assets, an executor of your will or a legal guardian of your dependents. Ensure that the fiduciaries you appoint are willing to take up the tasks and also let them know where your assets are.
The process may seem complex but it is paramount, and you need to consider it. Hiring an estate lawyer will make it easier. When hiring the attorney, get one who is reputable.