When a person passes away, their estate is typically subject to probate. Probate is a process that is overseen by the courts and provides a way for an estate to be settled and appropriately distributed in accordance with the instructions of the will.
Do you think you should have a will? Have you not gotten around to writing one yet?
Trusts are a very common estate planning choice for those who have significant assets. This is true for several reasons, but most notably, it is because holding assets within a trust enables the assets to skip the probate process at the end of the estate planner's lifetime.
Making a will and planning your estate effectively takes time and effort. Many people avoid engaging in the practice of planning their estate because they do not want to spend too much time thinking about the inevitability of death. The prospect of death is a morbid topic, but planning your estate does not need to be. In fact, planning your estate can be an uplifting activity because you can plan how your assets will benefit others in the future.
Most people know that they need to do estate planning at some point, but they may simply put it off because they're not exactly sure when to begin. How soon will they need that plan? When do they want to get everything in order?
You have a child with special needs. You provide support and assistance right now, but you are very conscious of the fact that your child will need extra help when you pass away. You're considering leaving them the bulk of your money in your will, knowing your other children will understand.
When starting to think about estate planning, you will likely come to realize the importance of wealth protection. When wealth is not protected strategically, it can become subject to high tax rates at the end of your lifetime. Additionally, assets can be vulnerable to losses if poor financial decisions are made regarding other assets.
Wealth management professionals advise their high-net worth (HNW) clients to take some important steps when developing their estate plans to help ensure a seamless transition of their wealth to their heirs and beneficiaries. However, these steps are wise for just about anyone, even if your estate isn't in the millions of dollars.
When you're developing your estate plan, it's important to acknowledge challenging family dynamics that might cause conflicts after you're gone. Many people don't like to admit to their estate planning attorney -- or to themselves -- that their children don't get along or that their blended family isn't exactly The Brady Bunch. However, attorneys have heard it all. By knowing what your concerns are, they can help you develop a plan that will minimize conflict.
If you already have a will in place, congratulations! You're a step ahead of many Americans who never get around to writing one and leave their loved ones to deal with the courts as they settle their estate. However, it's essential to review your will and other estate planning documents on a regular basis -- at least annually -- to determine whether any changes are warranted.