What is Estate Planning and Who Needs It?
Nearly everyone has an estate. It’s anything and everything you own– your car, home, properties, checking and savings accounts, investments, life insurance, furniture, and personal possessions. Furthermore, estate planning is an option for individuals and families in any stage of life, including the young, old, retired, healthy, sick, wealthy, and poor. We can’t predict accidents or illnesses, but we can prepare certain aspects of our lives for them. That’s why estate planning is so important– it carries out your wishes when you’re gone, disabled, or unable to care for yourself.
It’s not fun to think about, but when we die, we all want to make sure the right people or groups receive our most loved possessions, heirlooms, donations, or financial contributions. Estate planning involves the necessary steps to control how those things are given to the people or organizations you care most about. A plan with instructions that state who is receiving what andwhen they should receive it will help ensure that your wishes are carried out.
What Does Estate Planning Cover?
While the topic of who receives your belongings, money, and property is a big part of the planning process, a fully considered estate plan involves a much larger variety of options and situations, and may include:
- Instructions for passing your valuables and values (religion, education, hard work, etc.).
- Instructions for your care if you become disabled before your die.
- Naming a guardian and an inheritance manager for minor children.
- Providing for special needs family members in a way that doesn’t disrupt government benefits.
- Providing for loved ones who might be irresponsible with money or may need future protection from creditors or divorce.
- Life insurance to provide for your family.
- Disability income insurance to replace your income if you cannot work due to injury or illness.
- Long-term care insurance to help pay for your care in case of an extended injury or illness.
- The transfer of your business upon retirement, disability, or death.
- Organizing records and locating titles and beneficiary designations.
- Considering a living trust.
- Minimizing taxes, court costs, and legal fees.
Estate Planning is an Ongoing Process
Estate planning isn’t a one-time event. Your plan should be reviewed and updated as your family and financial situations and events change throughout your life. Also, laws will change during your lifetime, so it’s a good idea to update your plan and make sure everything is still current.
Who is Estate Planning For?
Anyone with children, spouses, family, belongings, property, insurance, values, money, or a business and others may benefit from estate planning. Your financial status and age doesn’t necessarily matter; what matters is that you plan now so that in 20-50+ years (or tomorrow), you wishes will be carried out and your family will be taken care of. Without a plan, whether it’s complex or basic and affordable, your state will control how your assets are used to care for you upon disability, how your assets are distributed to your family, if any, upon death, and who will raise your children, if any, upon both parents’ deaths. Estate planning is for anyone and everyone who wants to retain their right and choice to privately handle such decisions.
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