Estate planning is something that young families need to do just as much as their parents or grandparents. Estate planning is about far more than asset distribution.
Did you know that estate planning includes naming guardians for minor children in the event that both of their parents die before the children become of legal age? Most people don’t understand that when tragedy strikes and there is no will, guardianship is assigned by the court and not by trusted family members.
Estate planning isn’t just a topic for older people. It’s for young families with children, often the least prepared and most vulnerable in the absence of a will.
Planning your estate doesn’t mean you must have significant assets. Even if you are making a decent living, you still need to protect your family's future, like your home equity and your family's ability to maintain their lifestyle if you are gone. This requires you to take some simple steps now to avoid long and costly probate court proceedings.
The Chicago Tribune’s article, “5 essential steps of estate planning,” lists some things you should be doing now, before things get complicated.
Make decisions on who gets what. Create a list of your assets, how you want them distributed and the names of the person(s) appointed to carry out your wishes.
Visit a local estate planning attorney and do it correctly. This is not a do-it-yourself project with documents found online. If you make a mistake, you won't be around to correct it by the time it is discovered. Instead, engage an experienced estate planning attorney.
Learn about your estate plan options. Talk with your attorney about a will or a revocable living trust. A will must go through probate before assets can be distributed. If you create a revocable living trust, name yourself as trustee while you are alive and capable. If you pass away or become incapacitated, you have a successor trustee to take over so that he or she won’t have to go to probate court to be empowered to carry out your written instructions. With a trust, you must re-title your assets in the name of your trust.
Look at your health care issues. You never know if illness will take away your ability to make decisions. Select a trusted friend or family member to be your healthcare power of attorney. You should also make a living will to express your thoughts on any treatment required to prolong your life, as well as your desires for organ donation.
Think about your funeral wishes. Write these instructions down and place them in a spot where they can be found before your will is read. This usually takes place after the funeral is held.
Finally, don’t leave the process in mid-stream. Documents need to be signed and trust accounts need to be funded. If there are changes made to property ownership, titles need to be updated. You should also remember to tell key family members where documents are located and to provide contact information for your estate planning attorney. Making this easier for your surviving family members will be appreciated and remembered long after you are gone.
Reference: Chicago Tribune (May 8, 2017) “5 essential steps of estate planning”
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