Introduction
Estate Planning is the process of making plans to manage your assets when you die. Statistics show that only a third of Americans have drawn up Estate Planning documents (source). There are several advantages to Estate Planning both for the individual and their family. In this informative guide, we’ll discuss how Estate Planning works, highlight key advantages and offer advice for those keen to start making plans for the future.
What exactly is Estate Planning?
Estate Planning is a term used in the law industry to describe the process of deciding how your assets are managed when you pass away. For most people, making a Will is the most important part of Estate Planning. A Will is a legal document, which outlines instructions based on your wishes and desires. You can stipulate to whom you want to pass specific assets and provide information, such as plans for your funeral. Another integral part of Estate Planning is authorizing a power of attorney. A power of attorney is a legal file, which authorizes a specific individual to represent or act on behalf of another person if they become ill or incapacitated.
How does Estate Planning work?
If you are thinking about making an estate plan, it’s wise to seek legal advice. Legal experts will be able to make suggestions based on your individual circumstances. In many cases, making a Will is sufficient, but some people may also want to explore options, such as setting up Trusts. Trusts can be beneficial if you have a large estate or your estate is more complex, for example, you have different types of assets, you have adult children and your estate is worth a lot of money.
What are the benefits of Estate Planning?
The most significant benefit of Estate Planning is taking control of your assets. If you make a Will, you can specify clear instructions that will govern what happens to your estate when you die. If you don’t have a Will, the court will decide what happens to your assets following your death. Estate Planning enables you to name beneficiaries, issue instructions and manage your assets according to your wishes. You can also use your Will to specify what happens to your children or pets. Having plans in place will provide peace of mind and it will also make the process of dividing assets simpler and less stressful for your family.
There are also financial benefits to making plans for your assets after your death, particularly if you have a large estate and you’re considering setting up a trust.
Conclusion
Estate Planning is a process, which involves managing your assets and issuing instructions that dictate what happens when you die. The most important part of Estate Planning is making a Will. If you haven’t already made a Will, you wish to make changes to your Will or you’d like to find out more about setting up Trusts, it’s wise to seek legal advice.
Family.Estate can match you with a qualified planner in your area who can take care of all of your Estate Planning matters. Take our quiz today and promptly get matched with a planner.
Disclaimer
This is not legal advice and information may vary between states. Information found on this website is general in nature. Please consult with a lawyer for personal support.
Sources:
https://www.ramseysolutions.com/retirement/estate-planning-guide/introduction-to-estate-planning
https://www.americanbar.org/groups/real-property-trust-estate/resources/estate_planning/
https://www.legalzoom.com/articles/estate-planning-statistics
https://www.investopedia.com/terms/e/estateplanning.asp
