Though often difficult to think about, estate planning is a crucial aspect of one’s legal obligations you should do before you pass away. It involves ensuring that your assets are appropriately distributed according to your wishes, that your loved ones are taken care of when you’re no longer around, and making your passing as easy as possible for those surrounding you. Failing to plan your estate before your death can lead to disputes amongst family members and friends and even the loss of your assets to the government.
In this short article, we’ll discuss some things you should do before you die to ensure your estate is planned correctly.
1. Create a Will
The first and foremost step in estate planning is creating a will. A will is a legal document that outlines how you wish your assets to be distributed after your death, so it’s essential to create one as soon as possible, even if you are young and healthy. No one knows when they’ll pass away, so having a will and updating it regularly is an excellent way to ensure one’s assets are correctly distributed, even in the event of untimely death.
When creating a will, you’ll need to appoint an executor, who will be responsible for carrying out your wishes. This is an important role, so you must choose not only someone you trust but also someone who has the skills and knowledge necessary to handle the job. You’ll also have to specify who will receive your assets and how they’ll be divided, so it’s wise to consult with an estate planning attorney at Lanzet & Associates P.C. to ensure that your will is legally binding and that your wishes are properly documented.
2. Establish a Trust
While creating a will is always important, you should consider establishing a trust, a legal arrangement in which you transfer your assets to a trustee who is then made responsible for managing them on behalf of your beneficiaries. There are many kinds of trusts, each with its benefits and drawbacks, but they’re all covered under estate law and can be handled by an estate attorney.
One of the biggest benefits of a trust is that it can help you avoid probate, which is the legal process of validating a will and distributing assets. This lengthy and expensive process can also be stressful for your loved ones, so establishing a trust can ensure that your assets are distributed quickly and efficiently, sometimes even faster than a will.
3. Name Beneficiaries
Another thing you should do before you die is name your beneficiaries, which is also a crucial aspect of estate planning. A beneficiary is a person who will receive some or all of your assets after your death.
You can name beneficiaries for your bank accounts, retirement accounts, life insurance policies, and other assets, so it’s essential to keep your beneficiary designations up to date to ensure that your assets are distributed according to your wishes.
4. Plan for Incapacity
In addition to planning for your death, it’s also essential to prepare for possible incapacity, which in legal terms, means you’re no longer capable of making decisions for yourself due to illness or injury. If you become incapacitated, you’ll need someone to make decisions on your behalf, and it goes without saying that it should be someone you trust. This means that you’ll give power of attorney to this person, enabling them to make decisions for you if you become incapacitated.
In addition to planning for your death, planning for incapacity is essential. Incapacity refers to the inability to make decisions for yourself due to illness or injury. If you become incapacitated, you’ll need someone to decide on your behalf. By creating a durable power of attorney, you can appoint someone to make decisions for you if you become incapacitated.