There is no overstating the importance of having an Estate Plan in place. Estate planning is a journey that is unique to every individual or couple.
Not only can proper estate planning ensure that your assets go to your desired beneficiaries, it can also ensure that family relationships stay positive for years after your death. There are few ways to start family feuds faster than dying with no will in place.
Even though your estate plan will be unique to your estate and your personal financial situation, there are some steps that are common across the estate planning process.
1. Pick your beneficiaries
Beneficiaries are the people who will inherit your assets when you die. You need to figure out who is getting what, and you also should demarcate what percentage of your estate you want particular beneficiaries to inherit.
To outsiders, leaving a particular child out of your will or favoring one child above the others may seem like an “unfair” or “unusual” way of dividing your estate. In cases like these, you will want to make sure your estate plan is airtight. It is your right to decide who gets what from your estate, but you also want to ensure that it is not easy to challenge an “unusual” will.
2. Make contingency plans
It is possible that your beneficiaries may die before you do. In this case, you will want contingent beneficiaries to receive this inheritance. Essentially, if your married daughter with children dies before you do, do you want her share of the inheritance to go directly to your grandchildren or your son-in-law?
3. Choose an executor
You will need to pick the person who will manage your estate after you die. It is a good idea to have multiple people (or institutions!) in mind for this. When you are looking for an executor, it is usually smart to choose somebody who is generally responsible and in good financial standing. It is also wise to choose at least one younger successor in the event that your initial choice for an executor dies first.
Failure to do this may result in your beneficiaries needing an administrator for your estate, particularly if your estate engenders conflict between your potential beneficiaries.
4. Choose a health care agent
In the event that illness or injury incapacitates you to the point where you are not able to make medical decisions on your own behalf, you will want a health care agent to make these decisions for you. Most people choose their spouse for this position, but it is wise to have at least 2 backups.
5. Take care of children
If you have any minors under your care (or adults with special needs), make sure to name a guardian for them. You will want at least 1 backup for this position.
6. Organize your property documents
If you own real estate, make sure to have the grant deed and property tax bill and any other pertinent documentation at hand.
Contact us at AmeriEstate today to learn more about how to finally start your estate plan.