We never hesitate to spend a significant amount of time planning for major events in our life like a wedding or the vacation of a lifetime, yet we might be reluctant to spend any time at all on estate planning.
Planning how all your assets will be handled after your passing isn’t anyone’s idea of fun, but it’s a necessity if you want those assets and loved ones protected. If you don’t have a plan, be assured that the state you’re living in and the ones your assets are located at will have one, and you might not like that plan at all.
Contrary to popular belief, estate planning isn’t only for the rich. Don’t be surprised to know that right now, you have an estate because an estate is anything you own. It doesn’t matter if the estate is huge or humble. In fact, the more modest your estate is, the more important it is to have an estate plan because you don’t want your beneficiaries to lose anything of what is left for them since they might have little else to depend on.
You may not have an estate plan yet since you may never have thought about it, or simply don’t know where to start. This article can help you by introducing 5 things to keep in mind when preparing a plan. This will simplify the task for you so you can know where to start and what sort of things can be part of the planning.
Create a Will
Anyone who is 18 years old or above and has assets can create a will. A will dictates how, when, and where your assets should be distributed and who will get what according to your instructions. It’s important that your will is updated every so often because situations change. Your assets can increase over the years, and your relationship with people may not stay the same, both of which can lead you to make changes to your will. Having an updated will is vital because if you don’t, it will be up to the court to dictate your will.
Planning for Minors
Almost anyone with children wants to leave something behind for them. For many, their children are the catalysts to create an estate plan. If a child is still of minor age after you’re gone, you want to make sure they will receive the assets you leave them. More importantly, you want to name who their legal guardian will be. Societies are changing with many single-parent households open, so who is legally responsible for minors might not be so clear-cut in different households.
Power of Attorney (POA)
A power of attorney is a legal document whereby one person is in charge of your estate on your behalf. Many people need POA because they’re unable to handle things themselves. This could be due to illness or any other reason. Laws regarding POA can differ from state to state. Under Georgia law, for example, a person is considered incapacitated if they’re unable to manage property or business affairs because of an impairment, or because they’re missing or out of reach, or detained. It can get complicated, so it’s worth exploring more about POA via the Atlanta Estate Law Center, to help achieve your objective quickly and see the options you have. POA is typically inexpensive and relatively simple and easy to create. It can save your family time and money.
Revocable Living Trust
This type of trust can help you to avoid probate (a long and expensive procedure to prove a will) and reduce taxes. A revocable living trust can give your loved ones almost immediate access to cash during a difficult time. Take note that probate is a public proceeding, yet a living trust guards your privacy and that of those involved in the living trust because it’s not filed in a court.
Letter of intent
Though it doesn’t hold legal weight, a letter of intent can include many personal things that will help the family during this difficult time. A letter of intent can include things like passwords on your computer, how you want your funeral carried out, information on your bank account, etc.
While you’re alive, you are the one protecting all your assets and everyone you’re responsible for, but who will do that after you’re gone? Wondering about that question means it’s time to sit yourself down and seriously work on creating an estate plan. Things are difficult enough when it comes to dealing with the death of a family member. You don’t want to make it more difficult by ignoring estate planning.