Why do you need to come up with an estate plan when you don’t even have a lot of money in the bank, or assets under your name? In your mind, you don’t even really have an estate worth drawing up a plan for. Financial and legal experts state, however, that no matter how much your net worth is, it’s still important that you have an effective estate plan because it will ensure that your family will be properly accounted for and whatever financial goals you have will be met after you have “passed on.” You want to make sure that whatever money and investments you’ve made will benefit the people that you care about. In this article are estate planning tips from experts to help you do what’s best for beneficiaries.
The first thing to do is to make an inventory of all your assets; write them all down. These assets are the money you have saved, (be it in a cookie jar or the bank) insurance policies, investments, real estate properties or business ventures. Second thing to do is determine the people who will have involvement in your estate planning affairs: from your planning team (normally composed of a lawyer, a tax professional and a financial advisor) to your beneficiaries.
A will is one of the important products of estate planning. The will determines how exactly you want your assets to be distributed and handled after you die. The will is always best complemented with a trust. It will allow you to decrease the taxes (estate and income) so your heirs or beneficiaries would no longer have to deal with so many “complications” that the state has set. Trust can even offer protection of your assets from creditors and lawsuits, therefore ensuring that you only leave financial benefits to your heirs.
It’s also greatly helpful to discuss your estate plans with your family and other beneficiaries. Money is often a big and powerful issue for people and you don’t want to turn your family into a dramatic soap opera because of it. Gathering your family and beneficiaries together to discuss the details of your estate plans will help you explain your motives clearly. Also, it’s the perfect opportunity to resolve issues that may arise and preserve the good relationship of all involved parties.
In conclusion, there are great advantages to doing your estate planning early, but perhaps the best thing it does is to fully reflect the love and concern you have for the people you will leave behind.