In the hustle and bustle of our everyday lives, thoughts of what happens after we pass might not be top of mind. However, taking the time to create an estate plan is an essential and crucial step in ensuring you secure your legacy and protect your loved ones after you are no longer around.
What is an estate plan?
An estate plan is, in plain terms, a roadmap that guides how you want to distribute your assets and what you want to do with them when you pass away. Estate plans are not just for the wealthy. Everyone should have an estate plan because, frankly, most people have at least some asset or property they will leave behind.
Protecting your loved ones
One of the primary reasons people create estate plans and ensure to update them as their lives change is because an estate plan protects their loved ones. Without an estate plan, there might be a courtroom battle over your assets, regardless of what you leave behind, and most people want to avoid that for their family and friends.
Clear instructions
For your peace of mind and that of those you love, an estate plan provides clear instructions about your wishes, what you want to do with your assets and even how you want the end of your life to be once you are not in a position to decide.
What is inside an estate plan?
Within an estate plan, there are usually various documents. The type of legal document that goes into each estate plan depends on each individual person. Some examples include:
- A will, power of attorney and trusts
- Designation of guardianship of minor children
- Healthcare directives and end-of-life plans
Besides the documents above, having a well-prepared estate plan ensures a minimum tax burden on your assets. There are different ways of structuring your assets and sometimes you can save money by thinking ahead and using certain legal strategies.
Life is unpredictable, but one thing is certain: everyone passes away. By creating an estate plan, you give yourself the gift of peace of mind; you protect your loved ones, can leave them explicit instructions so they can understand your wishes clearly, and know what you want to do with your last days and your assets.