Estate Planning

Understanding estate planning

Estate planning is probably the least understood area of financial planning. It is also possibly one of the most important components of a solid financial plan. Many people think it's only for the rich, or it can be done later when you're older. Neither of these are true or to why your estate is everything you own, minus everything you owe. Everyone has an estate. It is very common for even people with a lot of financial resources to not have any plan in place when they become sick or die. You've heard of celebrities like Prince or James Brown that have plenty of money but failed to plan. Therefore, it is important for everyone to make sure that all of your resources are working and that there are no gaps or weaknesses that will surface at the moment. We need to be concentrating on other things, such as your health and recovery. Not only is it important to get your affairs in order in the event of death, but there are many estate planning tools to help you manage your finances while living. For example, a durable power of attorney can help you protect property in the event an individual becomes unable to handle financial matters. A durable power of attorney can help you protect property in the vet. An individual becomes unable to handle financial matters. It also allows a person to authorize someone else to act on his or her behalf to do things like pay everyday expenses, collect benefits, watch over investments and file taxes. The power training must be drawn up by an attorney. This is important. They will keep a copy on file. I would also suggest that the person you name is someone who has your best interests in mind as they will have access to your money. This person needs to be a reliable, trustworthy and responsible person. Taking the time to identify this person is imperative. A living trust also known as a people revocable trust is a separate legal entity that protects property and investments. It's called a living trust because it's meant to function while a person is alive. The trust is controlled by the person who creates it, and they can change the terms, transfer money, transfer property in and out of the trust or in the trust altogether. That individual can also be called trustee, such as a financial institution or a loved one to manage the assets in case he or she is unable to do so. Do not wait until you are in a crisis to set up a living trust. An advanced medical directive lets others know what medical treatment is desired and it establish who will make medical decisions for the individual in the event they are unable to make decisions for themselves. Depending on what's allowed by the state in which the person lives. This document may also include a living will, a durable power attorney or health care, and a do not resuscitate order. Planning ahead for these things will allow everyone to know if that's what you want. It will allow expenses to be paid without interruption. It can give you peace of mind as to how you want to be medically cared for in the event you cannot make those decisions yourself. Some estates are simple and others may be more complex, especially when you have blended families. I suggest talking to an estate attorney to give you direction. Planning now can save you thousands of dollars later.