Estate planning may seem like one of those things you can do “later.” But in truth, it’s never too early to begin thinking about your estate. Life happens, and anything could happen to you or a loved one sooner than expected. The sooner you can sort out your affairs for your surviving family members the better.
What is Estate Planning?
Estate planning is the process of determining what happens when you die or are incapacitated. It can be a tough, sometimes uncomfortable thing to think about, especially when you are in good health, but unfortunately many people overlook this process and when tragedy strikes it is that much harder for their loved ones to manage everything. Generally speaking, the estate planning process involves creating a will and designating a power of attorney and a medical power of attorney. In some cases, estate planning can also include a trust and funeral planning requests.
How to Begin Estate Planning
Assets — The first step in the process is to take stock of all of your assets. These include any investments, your retirement accounts, insurance policies, real estate, business interests and other financially or emotionally valuable items. This would include things such as jewelry, cars, baseball card collections — basically anything that might hold deep personal significance to you.
Will — The next step involves creating a will, which will indicate what you want to happen with those assets after you’ve passed and who should inherit them. This part of the process also involves setting up a fund for any long-term care you might need in an assisted-living facility or nursing home, appointing guardians for your children, or setting up a trust for a child with a disability. You should re-evaluate and update your will often to reflect any changing circumstances in your life such as a new marriage, divorce, or new children and you should consider review your plan at least once every 3-5 years, even without a change in your circumstances to make sure your plan is up to date.
Business & Personal Affairs — During this time, you also want to carefully consider who you would want to handle your business affairs and medical care in the event that you become incapacitated. These individuals would have power of attorney and medical power of attorney if anything were to happen to you. Thus, it is very important that you choose individuals whom you trust and know will respect your wishes.
Next Steps
After making your individual bequests, it is important to sit down and discuss your plans with loved ones. The sooner you clearly outline your intentions to your family and friends, the less likely there will be disagreements that arise after you’ve gone.
Remember that every estate plan is unique. If you would like to begin the process of estate planning, contact us so you can start planning for your future immediately.
