Estate planning can seem complicated to those who are just getting started on evaluating what, exactly, is right for them. This is understandable, since there are many different options to consider. What’s right for you may be quite different from what is right for others. So, how can you get started on estate planning?
A recent news article provided some helpful tips that our readers may want to consider as they get started on the estate planning process. For starters, as the article mentioned, a will is usually essential as part of an estate plan. The basic premise of a will is to dictate who should receive assets – which particular assets or in percentages, which will likely vary from person to person. A will can also designate a guardian for minor children, if necessary.
The article also mentioned that trusts can be a useful part of an estate plan. A trust is a legal mechanism by which assets are passed on to be held by a trustee, usually for the benefit of another person. So, for example, a parent with minor children may pass on assets to a trust for the benefit of those children, with a grandparent appointed as a trustee to make sure those assets are used for the benefit of the children.
The recent article also noted that power of attorney forms are commonly included in most estate plans. These documents appoint someone else to make important financial or medical decision on your behalf, if you are unable to do so.