More Than One Way To Plan an Estate

Estate Planning Lawyer

Estate planning is something most people associate with wealthy individuals who want to control what happens to their wealth when they are gone. Anyone who has assets and a family should have an estate plan though. An estate can be managed in several different ways, and there are general steps anyone needs to take before selecting one of those options. 

General Estate Planning Considerations

Regardless of whether you decide to make an estate plan or not, it makes sense to take certain steps:

  1. Inventory tangible assets, things like cars, a house, and a jewelry collection. 
  2. Inventory intangible assets, things like life insurance, retirement funds, and stocks and bonds. 
  3. Estimate the value of your assets, with help from a third party if needed.
  4. Consider your family’s needs by checking your life insurance and designating guardians for your minor children.
  5. Decide on your beneficiaries and review who they are to ensure the right assets go to the right person. For example, if a former spouse is still the beneficiary on your life insurance policy, your current spouse will get nothing when you pass away. 

You have several estate options. You may want to combine two or three, depending on your situation. Art, rare or collectible books, and copyrights are some examples of assets that can be difficult to value accurately. 

Estate Options

An estate plan includes one or more documents. Your estate plan will probably involve a trust, a plan that describes how your assets will be used while you are alive and who can make decisions for you should you become incapacitated. There are revocable trusts, which can be changed by their creator, and irrevocable trusts, which cannot be changed. Establishing a trust also helps avoid probate, a court-controlled process of distributing a deceased person’s property. 

A living will, also known as a medical care directive, specifies what is to be done if the creator is no longer able to make medical decisions for themselves. You might also give someone medical power of attorney, which empowers that person to make medical decisions for you. A durable power of attorney might be useful. This document assigns someone the right to manage your financial or legal affairs on your behalf. A limited power of attorney restricts that individual’s control to one thing or one type of decision. 

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