4 Steps For Creating An Estate Plan

Posted on: 29 April 2020

When it comes to protecting yourself and your family, one of the best ways you can do so is by having an estate plan in place. Everyone should have an estate plan in place, regardless of your financial position.

Step #1: Create a Will

First, you need to create a will. A will is the type of estate plan that most people are familiar with. A will is where you state who you want to get all your belongings when you pass away. You can keep your will general, and just name who will get your house, car, and bank accounts.

Or you can create a really detailed will that gives away specific belongings to specific people, such as giving a favorite painting to your niece or giving your tool collection to your best friend. This is a general document where you can make sure that the people you want to get things.

Step #2: Build a Living Trust

Second, you can build a living trust. A living trust is different than a will, and often preferable or a good supporting document to a will. With a living trust, you will be able to more easily transfer your ownership of goods to your survivors. You will also save the individuals in your will from having to deal with the probate court process, which takes a lot of time and can be expensive as well.

Step #3: Create Health Care Directives

Third, your estate plan needs to include health care directives. A health care directive should include information about who you want to make your medical decisions if you are not able to make decisions. Your health care directives can also include information about what type of choices you want to be made on your behalf if you are not able to verbalize your health care choices.

Step #4: Establish a Power of Attorney

Fourth, you need to establish a power of attorney. A power of attorney is someone you trust to take care of your finances if you are not able to take care of your finances. This needs to be someone who you really trust and who has smart financial insight. You also need to make sure you write down important financial information that someone would need to know if they were to become a power of attorney.

When it comes to protecting yourself, you need to create an estate plan. An estate plan contains more than one document. It includes things such as a will, living trust, health care directive, and power of attorneys.

For more information on estate planning, reach out to a local estate accountant.