After the death of a loved one, the relatives or close friends may find it very hard to settle the estate of that particular deceased individual especially if their estate wasn’t planned well. It may sound a little bit weird to some people but it is often advisable for people to plan for what is going to happen after their death. This planning is mostly centered around what people should be done to the properties, assets and other things the deceased owned before passing away.
Just before we go deep into any difference that can actually exist between a will and the actual estate planning, let’s talk about some important terminologies related to will and estate planning.
What is an Estate?
Everything that has to do with the possessions, cash, financial securities and other things that belonged to a deceased individual before his or her death, is what we refer to as estate. Other notable things that are under the roof of what an estate entails are as follows:
- Total networth of the deceased
- Economic valuation of all the investments
- Both physical and intangible assests
- Land and real estate
- Collectibles and even furnishings
After the death has been registered, the estate of the deceased can’t just be lying around without use or without someone else claiming them. Before one can actually handle someone else’s estate, he or she has to go through a legal process which is another terminology we refer to as probate.
What is a probate?
A probate is a legal document issued by an official court that grants you the permission to settle the affairs related to the estate of a deceased and without it, you won’t have the authority to deal with anything related to that estate. Most people feel the probate process is too stressful but if the deceased actually had a proper estate planning, this wouldn’t be a hard task at all.
Now that we already have an idea on some of the important terminologies, let us now go into notable differences between a will and estate planning.
The difference between a will and estate planning
A will is a legal document that clearly states your final wishes together with details about who your beneficiaries are, how you want your assets to be handled and every other legitimate actions that you want to be done after your death. A will can be very helpful to the people left behind as it would be able to determine how to go about the distribution of your assets and who gets them. In summary, beneficiary designation and distribution of one’s assets after he or she has passed away, are the two major reasons why people write their wills.
Estate planning on the other hand, is a term for generalizing the intensive processes used in securing assets after your death, which is mostly done in accordance with a will. An estate plan is very comprehensive and it includes documents that are effective during your lifetime as well as other documents that aren’t in effect until your death. This actually doesn’t apply to a will because a will mostly becomes effective after the individual who wrote the will has passed away.
A will or a living trust is actually what starts an estate planning and this should be able to explain to you why a will is just a little part out of estate planning. As you can see there isn’t much of a difference between wills and estate planning because the two of them work hand in hand and you would need one for another.
Before you heed unto any recommendations to you concerning anything that has to do with estate planning or the preparation of your will, you either ask questions or see an experienced law attorney. Don’t jump into conclusions because understanding the difference between estate planning and wills first, is important for anyone to prepare correctly for the future.