Planning your estate can feel overwhelming when you have no idea where to begin. A common myth about estate planning is that it is a one-time deal.
Maintaining your plan throughout time can help you preserve its function. When you know where to begin, you might feel more motivated to take the first steps in planning your future.
Participants
Even though this is your estate plan, you will need to involve other people in helping you execute it. For example, you will want to name beneficiaries. These people will collect your assets, heirlooms or financial gifts at the end of your life. These are usually people you respect, love and feel the responsibility to care for. You will also want to name an executor who will have the task of closing your estate after you pass.
If you reach a point in life where incapacitation renders you incompetent, you will want to have a power of attorney and health care proxy named in your estate plan. These individuals will have your permission to manage your finances and make medical decisions on your behalf.
Formal documents
A number of formal documents might become part of your estate plan over time. According to U.S. News, one of the most critical documents to create is a will. Within this document, you will list beneficiaries, name a guardian for any dependents in your care and disclose your executor. You might also consider a trust. This strategy allows you to transfer property to beneficiaries without going through probate.
Periodically updating your plan can help you avoid costly and disappointing oversights. An estate plan can add value and security to your life. It can provide comfort and clarity for your heirs.
