Did you know that every October estate planning professionals and organizations across the country gather in observance of National Estate Planning Awareness Week? Since 2008, the event has focused on helping the public understand what estate planning is, and why it is a critical component of financial well-being. This year, this important week takes place from October 21 – 27.
Without an estate plan, there is no guarantee that your end-of-life and legacy wishes will be followed.
In fact, it becomes more likely that important estate decisions will default to arbitrary state laws, probate courts, and other entities outside your control. This may not only be costly, but can cause confusion and infighting among family members.
Creating an estate plan to avoid these issues, and more, is critical. Yet, the National Association of Estate Planners & Councils estimates that over half of Americans, or 56 percent, either do not have an estate plan or have one that is out-of-date. Although it may appear daunting at first, let us share a few of the basics that you need to know to have a baseline of how to be prepared with an estate plan.
1. Draw up a will with your estate planning attorney.
At a minimum, consider creating a last will and testament with your estate planning attorney. This is a legal arrangement where estate assets are distributed to selected beneficiaries upon one’s death. Bear in mind, however, that some assets such as retirement accounts and life insurance policies, may have beneficiary designations outside of a will.
2. Set up a trust agreement with your estate planning attorney.
If you have a sizable estate, special needs children or grandchildren, or you are concerned your heirs will not be wise with an inheritance, you can create a trust agreement. This estate planning tool offers you additional protection and control, and allows you to appoint a trustee to distribute and manage legacy assets.
3. Consider your health care needs.
Estate plans are not just about finances. A comprehensive plan will include vital health care documents. Through these documents you can allow a trusted person to make health care decisions on your behalf if you become incapacitated.
Remember that your estate planning attorney can create and customize a plan that is right for you and your family. This might include the topics discussed above or contemplate strategies for limiting taxes, such as gifting heirs estate assets during your lifetime or setting up a family-controlled charity. Do not wait to contact us to answer any questions you may have on estate planning and/or elder law.