What Are The Main Steps in Estate Planning?
Estate planning isn’t something that only the wealthy or those that are older should be considering. Everyone who has assets to leave and loved ones to leave them to can benefit from having an estate plan. An estate plan is a document that lays out how you want your assets distributed to people or charitable organizations important to you. If you don’t have an estate plan in place before your death, state law and probate courts will make the decisions for you, which may not always be in your family and loved ones’ best interests. So, what are the main components of estate planning?
1. A Will
A Will is a critical part of your estate plan that defines who you want to receive your assets after your death. It can also include information on who you want to take care of your minor children, a decision most parents consider to be the most crucial aspect of their Will. A Will allows you to clearly define who gets what, enabling your estate to be settled quickly and without questions.
2. A Trust
A Trust is another of the main steps in estate planning. A primary benefit of a Trust is to avoid the probate process. Avoiding probate is key to simplifying the process of distributing your assets after your death. When setting up a Trust, you:
Identify what assets you want in the Trust,
Name who the beneficiaries will be,
Decide if you have any specific timing for distributions of the assets,
And, name the trustee who will be responsible for managing the Trust.
3. Health Care Directives
Health Care Directives include things like a Living Will and Power of Attorney for health care. These are vital to have in place to ensure that your wishes regarding your health care are carried out if you become unable to make medical decisions for yourself.
4. Paying for Funeral Expenses
There are several ways to ensure that your funeral expenses are covered. You can set up a funeral pre-payment plan with a specific funeral home, buy final expense insurance, or simply set aside a portion of your estate to cover those costs. Funerals can be costly, so a bit of planning can go a long way in ensuring the expenses are taken care of and even the details of exactly what you want for your funeral are outlined.
5. Documents for Safe Keeping
Once you have addressed the main steps of estate planning, it is also critical to make sure you have all of the legal documents stored in a safe place. Ensure that either your estate planning attorney or other trusted family or loved ones know where they all are so they can execute your estate plan in the case of your sickness or death.
While we have outlined the main steps in estate planning, your estate plan should be custom to you and your situation. It is not a “one size fits all” kind of plan. There are other components and specific strategies you may want to consider given your unique situation. This is why it is essential to work with an estate planning attorney who can help you develop a plan tailored to your needs. The Rilus Law team of experienced attorneys has created custom estate plans for thousands of clients. We’d be happy to assist you with yours! Give us a call today to book your free Personal Family Legal Session.