The new year is a time when people want to make positive changes to their lives. One that isn't thought of often but that should be is estate planning. Having your affairs in order when you pass away is one of the best things that you can do for your family members. Additionally, you will likely find that you feel more secure and at peace knowing that they are taken care of when you are gone.
One thing you have to decide when you are creating an estate plan is whether you need to set up trusts. If you decide that your heirs can benefit from having things placed in trusts so they are transferred easier when you pass away, you'll have to determine what types of trusts you need.
Your estate plan outlines who gets what when you pass away. It is imperative that you understand what your plan says and that it is up to date. You should review it at least once per year so that you can see that everything is set how you want it.
When you have any assets or loved ones, you need to think about creating a will. This document outlines what you want to happen to your possessions when you pass away. This might not be something that you want to think about, but it can help your loved ones to get everything settled after you pass away.
Legendary singer Aretha Franklin passed away recently of cancer at age 76. She died at her home in Detroit and left behind an estimated fortune of $80 million.
When considering how you will pass your assets on to your family, you need to use far more than precatory language. Essentially, precatory language is the act of verbally promising someone that he or she will get something. It may be specific or more general. Either way, it does not replace a will.
An inheritance tax is a tool that governments sometimes use to tax assets that people get as part of an inheritance. As you can imagine, this tax can have a big impact when leaving a significant estate to your heirs.
Estate planning may start with assets and inheritances, but do not assume that's all you need. You also want to plan for your health care needs in the future.
It's important to pick the best possible person to be your estate executor. Many people pick heirs. However, you also want to pick the right heir. It's not necessarily an easy process, and not everyone is cut out for it.
The biggest mistake you can make when planning your estate is to not have a plan at all. No matter what your age or financial status, it's a good idea to have a plan in place -- if for nothing other than to make sure that your family knows your final wishes regarding burial or cremation.