Drafting an estate plan is more than just preparing for what will happen at your death. It helps articulate your wishes to your family members and beneficiaries in case you become incapacitated or suddenly die in an accident. Thus, estate planning is not only for the elderly. No matter your age, drafting an estate plan could be a very vital step to take.
While the term estate plan triggers some unsettling thoughts, this process should not be looked at as something negative. Although it can be overwhelming, those considering an estate plan should understand the basics first. This can ease the process, helping to ensure that individuals have gone through the proper steps to develop a valid and effective estate plan.
To begin, individuals should understand what even the simplest and basic estate plan entails. A will is probably the most important document to include in an estate plan and is the only way a person can adequately communicate their wishes to their heirs. Whether you draft a will or a living will, it is imperative that such a document is included in an estate plan.
Next, it is crucial that those with an estate plan take steps to keep it up-to-date. Life tends to bring many changes, and these changes could alter the very purpose of the terms in a will or trust. Whether it is a marriage, divorce, birth of a child, receiving an inheritance or suffering a death, documents in an estate plan need to be continually updated in order to ensure they are still relevant and correct.
Finally, individuals should consider other factors such as protecting a business and designating a person to control his or her finances and health care decisions. If you own a business, it is important to detail how you want it to be treated at your death. Whether that means passing it on to a spouse, child or another heir, an estate plan could detail how you want the business run and treated after your death. With regards to financial and healthcare decisions, an individual should consider including a power of attorney in their estate plan. These documents could give the power to a designated person to fulfill your financial and healthcare wishes if you were to become incapacitated.
While estate plans can be complex, the most challenging aspect of this process is making major future decision and thinking about your death. This is overwhelming no matter which way you look at it; therefore, those considering the estate planning process should take the time to understand the process, seeking legal advice when necessary.
Source: Investopedia.com, "Estate Planning: A To-Do List to Get You Started," Chris Cooper, July 24, 2017