What are the Key Strategies for Estate Planning?
You want to do everything right before you die. How do you achieve your goals?
We may not want to think about it, but death is inevitable. We are all going to face it at some point, so you might as well plan for it.
Estate planning is not just for the wealthy. It is something everyone should do to ensure their wishes are carried out. A well-constructed estate plan also reduces stress for your grieving loved ones.
To be effective, though, an estate plan needs to be done properly. One mistake can cause family disputes after your death. Here are some key strategies to keep in mind.
Take note of all your tangible and intangible assets. Tangible assets include homes, real estate, cars, collectibles, and other personal possessions. Intangible assets may include bank accounts, retirement plans, life insurance policies, stocks, bonds, and business ownership. If you plan to distribute your assets equally, you will want to get them valued, as well.
Make sure to detail everything or else your loved ones might not know what to do. Then the state will end up making decisions for you. Along with instructions on how to distribute your assets upon your death, your estate plan should include:
- Healthcare power of attorney. Allows someone to make health decisions on your behalf if you are unable to do so.
- Durable financial power of attorney. Allows someone to make financial decisions on your behalf if you are unable to do so.
- Directive to Physicians/Living will. Provides instructions about what medical treatments you do and do not want if you have a terminal illness or are in a vegatitive state.
Consider a Trust
While a will may be sufficient for most situations, a trust will be better if you have significant, i.e. more than ~$3.5 million of valuable assets. With a trust, you decide what you are going to put into it and who gets what. With the right trust, your assets will go where intended. Plus, you will avoid probate, which can be costly and time-consuming.,
Set Up Guardianship for Minors
If you have children under the age of 18, you will need to determine who will serve as their guardian in the event of both parents’ death. If you do not, a judge will appoint someone for you. Make sure you choose someone you trust, and you get their consent.
Keep Assets and Beneficiaries Updated
Once you create an estate plan, you will need to keep it updated. This means you may have to add and remove assets as needed, such as when you sell them or acquire new ones. The same goes for beneficiaries. Marriages, divorces, births, and deaths may mean you have to add and remove beneficiaries. So be sure to update your estate plan as life events occur.
Contact a Pearland Estate Planning Attorney
When it comes to estate planning, there are no shortcuts. Work with an expert to ensure the details are correct so you do not make a major mistake. After all, you will not be able to make changes once you are gone.