No matter how much money or property you own, you have an estate. Some people may believe that estate planning is more suitable for those who have a large sum in the bank and several properties. However, this is not the case, as the intention of estate planning is not about how much you have, but ensuring your legacy is handled in the way you wish after death. Your estate entails everything you own, such as a home, vehicle, real estate, art collection, furniture, jewelry, and personal possessions. Regardless of how substantial or modest your estate, this will not go with you after you pass on. So, it can help out your family to have a plan already created for how you want these items and amounts to be distributed.
Q: What is the overall goal of estate planning?
A: Estate planning is a great way to leave behind instructions for what amount, and to whom you want your belongings to be distributed. To accomplish this, you can create an estate plan that includes who is to receive a portion of your assets, what exactly you want them to receive, and when you want them to receive it. So all in all, estate planning is providing directions in advance for what happens to your things after passing on.
Q: What usually is included within an estate plan?
A: There are so many factors to consider when establishing your estate plan. Many people confide with a lawyer who is familiar with family law for guidance. Not only must a person write an estate plan, but it must be signed and legally-binding. A lawyer can oversee this process to help prevent against any problems happening with your plan after death. A thorough estate plan often includes the following:
- Directions for how to pass on your valuables
- Preferences for health care if you become disabled or incapacitated, and are unable to communicate your wishes
- Name of a guardian for minor children and pets
- Provide support for loved ones with special needs, without impacting government benefit eligibility
- Provide support for family members who may not be responsible with money, or who need protection from divorce or creditors in the future
- Life insurance policy to support your family if you were to become disabled, injured, or come down with an extended illness
- Include instructions for transferring your business after retirement, death or in the event of disability
- Minimize or eliminate taxes, court fees, and other legal expenses
Q: Is writing an estate plan just a one-time thing?
A: Once a person creates an estate plan, it is important to keep updating it as life circumstances change. For example, an estate plan may need review after a divorce, marriage, children are born, more assets are accumulated, or relationship dynamics change. It is suggested that a person revisits their estate plan every few years, unless a major life change happens before that. It can help to have a lawyer review an estate plan as well, for suggestions and potential edits.