Your Estate Planning
Part 1 of 3-Part Series
Estate planning is one of the most difficult things you will likely make in your financial planning journey, but in our eyes, it is also the most important. It is also the most overlooked aspect because as humans we do not like to consider our demise. It’s very understandable, it’s not the most pleasant conversations that we need to have in order to plan for our death, but after putting in all the hard work to become financially secure, the final step is your legacy and taking care of your family. Most everyone will know about wills, which we’ll touch on, and what their purpose is, but there is much else to consider so that when the time comes, your hard-earned wealth is not taken by taxes, held up by the courts or causing a dispute among family members. The planning now will alleviate those concerns and the stress that comes with it.
First and foremost is actually discussing with the important people in your life what your actual wishes are. It’s easy in your head, but putting it down on paper and actually dividing your assets among the people you love is a bit harder. Your will is the base and most important piece of your estate plan. It needs to be clear and concise, legal and easily available when it is needed. Some of the vital instructions would include naming a guardian for your children (if still dependent), how your assets will be divided, to whom and what ages they will receive it, as well as your last wishes and burial instructions. It would also name an executor, or a person to execute your will. Ideally someone who you trust and is responsible in order to carry out your final wishes and file your last tax return. Having a second choice is also a good idea, in the case that your first choice is unable to be executor for any reason.
Drafting a will may seem daunting, but it can be done quite easily within the course of a day and quite affordably with a lawyer. This is of course essential as the will needs to be legal for the courts. You may think if you die without a will, all your assets would transfer to your spouse, however that is not the case. Without a will, the government decides to whom your assets will pass and this could go very badly. For a document which takes very little time to prepare and holds the utmost importance, it is best to get it done early.
Part 2 continued next week.