You were talking with a colleague, and they mentioned that they had just started working on a will and their health care proxy. You haven’t even thought about starting the process yet, but it seems like now may be a good time.
Making plans for your estate is part of getting older. It’s not necessarily fun to do, but it does give you an opportunity to think about how you may want to spread out the assets you have among your beneficiaries. It gives you time to start planning to reduce taxes and to reduce the stress your loved ones face if you suddenly pass away.
Did you know that only around 42% of all adults in the United States have estate plans? Yet, failing to have estate planning documents can mean that your family would have to go through probate, a long, drawn-out court process where your estate is handled by a judge.
What are some of the top issues to hit when you start your estate plan?
First, make arrangements for yourself. Set up who will be your executor and who will make financial or health-care decisions for you.
Next, take care of your home. You want to make sure you transfer it to a beneficiary early or add it to a trust. That way, it won’t be included in the value of your estate.
Finally, learn more about probate, so you understand why it’s so important to avoid it. Probate is costly and time-intensive, so helping your beneficiaries and family avoid it is key to effective estate planning.