What to consider…
Estate planning entails designating your assets to the people in your life and assigning them responsibilities for after your death or incapacitation. This is a difficult matter to consider, but it is important to be prepared for the inevitable. Estate planning can also include planning for the type of medical care you’ll receive if you were to get sick or seriously injured.
This process is not only for the rich or the elderly. All the assets you own are considered your estate and you can begin estate planning at a young age. Many people are not aware of how to go about estate planning. It involves more than just writing a will. Here is a guide to estate planning to help you get started.
1. Inventory your belongings
You should begin planning by inventorying everything you own. You might think that you don’t own enough to have to do this but once you start looking around, you’ll start finding different assets. Your assets can be both tangible and intangible. Tangible assets can include personal possessions like vehicles, art, antiques, homes, land or other real estate and more. Intangible assets include stocks and bonds, savings accounts, life insurance, retirement plans and more. Once you’ve done your inventory, you can get an estimated valuation of all the assets.
2. Identify the people you want to provide for
You will need to consider the needs of your family in your estate plan. If you have children, name one or two guardians. You can also include the way you’d like your children to be raised in the plan. You should also consider the needs of your spouse, friends, pets, parents and other loved ones. If your home is jointly owned by you and your spouse, you can opt for protecting your home from care costs to cater to their requirements.
3. Review your beneficiaries
In order to ensure that the right people get your belongings, constantly review the beneficiaries mentioned. You might’ve forgotten who you’ve assigned certain assets to which can cause trouble within your family after you’re gone. You can also name contingent beneficiaries in the unfortunate case of your primary beneficiary passing away.
4. Make a living will
A living will details the kind of medical treatment and procedures you do or do not want in the event of you becoming critically ill and unable to communicate your wishes.
5. Understand estate tax laws
Some states might levy estate or inheritance taxes. Only estates that are very large are subjected to estate taxes at a federal level. Ensure that you know of the tax regulations in your area of residence to make the process easier.
6. Seek professional help
You can consider hiring an attorney or an estate tax professional to help you create your estate plan. This decision depends on your situation. If you have a limited number of assets and simple wishes, you might be able to complete the process online. If you are confused about the process or have any doubts, consulting a professional can help. They can especially be of help if you have a large estate or special needs to be taken care of.