An estate planning process is a process that involves establishing a plan that will allow you to receive your assets and manage your affairs if you are unable to do so on your own. It can be very complex and feel like an overwhelming burden. While it’s commonly believed that estate planning is about your finances, it is much more.
Many people tend to put off estate planning due to the negative connotations of the subject. However, the sooner one handles their estate, the better. This protects everyone involved, including future family members.
It’s essential that you thoroughly examine your home and outside of it. This will allow you to identify all of the valuable items that you have. Some of these include jewelry, art, computers, and lawn equipment.
You should expect the list to take longer than you think. You might also want to add notes if someone in your life suggests that you want to have the item after you pass away.
Inventory Your Accounts
You should also add non-tangible assets such as your life insurance policies, bank accounts, and brokerage accounts. These items will include things you own on paper that depend on your death. Other policies you might want include long-term care insurance and auto insurance.
You should also include all your account numbers and the locations of all the physical documents you have in your possession. You should also list the company’s contact information holding these non-tangible assets.
Assemble the Appropriate Documents
Your Estate Plan should also include various critical documents. These documents will help you create a powerful representation of your wishes. These documents should consist of Guardianship papers (for parents with children), Wills, Trusts (if applicable), and other concerns such as Financial Power of Attorney (POA) and Durable Power of Attorney.
Don’t Forget the Taxes!
The goal of your Estate Plan is to leave as much as possible as your inheritance to your heirs. One of the most effective ways to achieve this is by minimizing the taxes you will pay. There are a variety of tools that you can use to reduce the taxes that you will pay. One of the most critical factors you should consider is the types of taxes you will be dealing with.