Estate planning involves making important decisions and plans over your future and that of your loved ones. It decides what happens to your assets both while you are alive and well or dead, how you want to share your assets to family, children or spouse, who takes over making certain important decisions for you in cases of mental incapability and lastly transfer of ownership of a property. These plans can only be presented, documented and implemented in wills and testament, living trust, revocable or irrevocable trust, advance medical directives and lastly financial power of attorney (power of attorney).
To enjoy a level of peace of mind, you should without hesitation start making preparations for your estate plans.
Estate planning tips you should know
Take inventory of your assets
Take a careful and detailed list of all material items which are in your name, including assets as large as real estates, and those as small as jewelries, antiques, etc. It would speed things up by naming a beneficiary for each item.
Take inventory of all intangible assets
After listing the physical material items, make a detailed list of all non-tangible assets such as bank accounts, insurance policies, IRAs, and list their location of the documents containing your ownership agreement, as well as information on the companies involved.
Itemize your debts
Next, you should carefully list out all debts and financial obligations which you may have fallen into during your lifetime, including existing mortgages, auto loans, and home equity lines of credit (HELOC), etc. Also include details of every credit card which you own including those you may not have used for some time.
Draft a will
A will is a very important and inexpensive estate planning document which every adult citizen should have. Most estate planning lawyers will help you create your will at a considerable rate, and will individualize the will based on the complexity of your estate such that your personal wishes would be effectively executed at your death. Ensure you designate a competent executor who would see to it that your instructions are carried out. You should seek and contact one of the best estate planning lawyers around you for legal advice and assistance in drafting your will. Have copies of your will and keep the original in a safe, while your executor gets a copy. However, only the original will bearing your handwritten signature will be probated in court.
Create a living Trust
Living Trust is one of the most useful document you should possess in your estate plans. It forms the bases of how your estates are shared or given to beneficiaries, what happens to you when you die and who makes certain financial or medical decisions for you when you are mentally incapable. Although, trusts may not seem too mandatory but there are certain estate planning issues that cannot be resolved without having one.
Update your will regularly
From time to time, check your will to see if it meets with all your current heart desires. Birth of a new baby, new marriages, divorce, etc., may influence a change to your choice of beneficiary, and as such you should duly apply such changes.
Make plans for your business
It is ok to prioritize the welfare of your family and loved ones when making estate plans. However, if you own a business, you also need to consider protecting it. If your business crumbles after your demise, how would your spouse and children cope? You won’t be around to always put food on the table, remember? So ensure you make plans to transfer that business of yours to a worthy successor. Someone who can handle the business better than you did.
Consider the size and complexity of your family
The truth is, the more the number of family you cater for, the more consideration for what you make your of your estate plan. If you have large family, you might should consider a more robust estate plan. Consider the following; If you are divorced, have children in past relationships, have a more than one spouse, you need to create a proper estate plan.
Create a succession plan
For new owners to take charge of your business, you need to create a succession strategy. This strategy will state, comprehensively, the new owners of the business should you kick the bucket. The strategy will also outline the duties of everyone charged with controlling the business. You can select a successor from a close friend, business associates, family members, etc. You need to be very careful when selecting a successor. If you choose a bad successor, he or she may ruin your business. In addition, if you choose a successor that close family members despise, problems may ensue.
Ensure your beneficiaries are correctly designated for each asset
Make a review of all your accounts, retirement accounts and insurance policies, ensuring that the beneficiary designated to each is as you currently desire. Each of these retirement accounts, annuities and insurance policies will pass on directly to the beneficiary regardless of your specification on how it’s to be done. You may need to contact your fiduciary, employer customer service team, or the estate planning lawyer in your service to ensure your beneficiaries are currently as you wish.
Speak to an estate planning lawyer
You may think that you have covered all possible loopholes and may fold your hands to rest, but any slightest mistake can render your estate to shambles. As you get older, there may arise a need to update your will, insurance policies, and healthcare documents, possibly because of changes in state regulations and tax laws, which would invariably affect your bequests. To ensure you are constantly on a right footing with the law, contact and hire into your service a competent estate planning lawyer near you with whom you have to maintain a regular feedback.