I know planning for your death is morbid and can be painful. Some don’t want to face the facts of life. My hope is that I go quickly. However, once I am gone, I want to make sure my family is protected. Thus, creating an estate plan can do that and provide me peace of mind. With a little thought and preparation now, you can save your loved ones a lot of time, stress and conflict, not to mention legal and financial woes in the future.
Here are the five essential steps to protect your loved ones and your legacy…
STEP 1: Think about what you want to happen.
Before talking to an attorney, get an idea of what you want to happen. Consider who can make decisions for you, if you can’t. Who will care for your children if you die before they turn 18? If you have a business, define what happens to it. Collect, document and evaluate your personal financial resources and assets. What do I have and who do I want to have it?
STEP 2: Create your plan.
Regardless of how old you are, create a plan. If you are over 18, Mom can’t make decisions for you without you giving her the right. Your parents cannot get access to your medical records, unless you give permission. You can state who you want to take care of your children and who will carry out your last wishes. A plan can also reduce taxes, if you plan accordingly. Working with an attorney you can create the proper documents. This may consist of a will, trust, special needs trust, powers of attorney, a living well and other documents.
STEP 3: Store your estate planning documents safely.
Keep your documents in a safe deposit box, fire proof box or in the cloud. You want them safe, but accessible to those that will need them.
STEP 4: Talk to your loved ones about your estate plan.
Make sure those you are counting on to carry out your plans are aware of your plans and are willing to do it. In addition to the contents and location of your will and other plans, make sure they know where to find the important financial, medical and personal documents. In the digital world that means user names and passwords.
STEP 5: Review your estate plan and update regularly.
As your life changes, so will your estate plan, along with the corresponding documents and beneficiaries. Life events such as marriage, divorce, moving and having kids affect your estate plans. Along with the estate plan, review the beneficiary designations on investments, life insurance policies and retirement accounts. Make sure that your ex-spouse will no longer collect the life insurance.
With a little of planning, you can reduce the surprises, protect your loved ones, have peace of mind and save your loved ones from more stress.
