Estate planning is the task of designating to whom and how you want your assets distributed upon your passing. The purpose is to secure that beneficiaries will receive their inheritance in a way that is as prompt as possible, while minimizing income tax, gift tax, estate tax, and other issues.
Estate planning may not seem like a fun task, especially because it will entail thinking about a time when you are no longer here with loved ones. However, if you want those closest to you to receive a piece of your legacy, then you must establish an estate plan. If you have yet to begin writing your estate plan, consider these tips:
Inventory Your Things
Many people think they don’t have enough assets in order to write an estate plan. But, this is simply not true. You may be surprised by the amount of tangible and intangible assets that you do own. Examples of tangible assets and intangible assets to inventory include:
- Homes, land, real estate
- Collectible items (art, antiques, coins, trading cards, etc.)
- Personal possessions
- Cars, boats, motorcycles
- Savings and checking accounts
- Bonds, mutual funds, and stocks
- Health savings account
- Life insurance policy
- Business ownership
- Retirement accounts
An estate plan is not complete without certain legal directives, such as a trust, medical care directive, limited power of attorney, durable financial power of attorney, and more. Your lawyer can assess your assets and situation and let you know how may be most suitable to fulfill these roles listed. You must choose someone who is willing to take on the role in the event that they need to.
In your estate plan, you will have to write down the names of people and organizations that you wish to have a portion of your assets. Many people choose their spouse, children, close relatives, and best friends as their beneficiaries. However, you can also choose a charitable organization as well. Discuss your preferences with your estate planning lawyer. As an estate planning lawyer from W.B. Moore, Attorney at Law can attest to, most people can benefit from an estate plan regardless of how much assets they have, and sometimes the hardest part is just getting started.