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Important Elements You Should Be Sure to Include
An estate plan is an important document that every adult should have. It ensures that your wishes are carried out after you die and can help to prevent family disputes. The fine details of what you wish to include in your estate plan depend on your unique situation, but there are several components that everyone should consider including in their future plans. Read on to learn some of the most essential estate planning components and their functions.
Last Will and Testament
A last will and testament is a legal document that details how an individual's assets will be distributed after their death. It is an important part of estate planning, as it ensures that one's final wishes are carried out and their loved ones are taken care of according to their wishes.
There are many different things that can be included in a last will and testament, but some essential components should always be included. These include:
A list of all your assets and debts, including bank accounts, property, vehicles, life insurance policies, etc.
Who you want to receive your assets after your death
Any special instructions for the distribution of your assets, such as specifying how and when they are to be distributed
The appointment of an executor, who will be responsible for carrying out your final wishes
The appointment of a guardian for any minor children
Including a last will and testament in your estate plan is an essential way to ensure that your final wishes are carried out and your loved ones are taken care of according to your wishes.
Powers of Attorney
Powers of attorney are an essential component of any estate plan, yet many people don't understand what they are or what they do. A power of attorney is a legal document that gives someone else the authority to make decisions on your behalf if you become incapacitated and are unable to make any decisions on your own power. This can be used in a variety of situations, from managing your finances to making critical medical decisions if you are unable to do so yourself.
While it may seem like a daunting task to plan for your own death, including powers of attorney in your estate plan is one of the most important things you can do for yourself and your loved ones. By naming individuals to act on your behalf, you can ensure that your wishes will be carried out even if you can no longer communicate them yourself.
Trusts
A trust is created during a person's lifetime and can be used to manage that person's assets both during their lifetime and after their death. A trust can be an essential component of an estate plan, as it can help ensure that a person's assets are distributed according to their wishes. Trusts can also help to avoid probate, which is the process by which a person's assets are distributed after their death.
There are many different types of trusts, and the type of trust that is right for an individual will depend on their specific needs and goals. Some trusts provide income for a beneficiary, while others are designed to protect assets from creditors or estate taxes. Trusts can also be used to manage property such as real estate or businesses.
When creating a trust, it is crucial to work with an experienced attorney who can help to ensure that the trust is properly created and funded. Trusts can be complex legal documents, and it is essential to make sure that they are created correctly to avoid any problems down the road.
Beneficiary Designations
Most people are familiar with the term "beneficiary" in relation to life insurance. A beneficiary is a person (or persons) named by the policyholder to receive proceeds from a life insurance policy upon the policyholder's death. What many people don't realize, however, is that beneficiary designation can also apply to other types of assets, such as retirement accounts and investment accounts.
When it comes to estate planning, beneficiary designations are an essential component. That's because these designations supersede any other instructions you may have provided in your will or trust regarding how you want your assets distributed upon your death. In other words, if you have not designated a beneficiary for your retirement account, investment account, or life insurance policy, your assets will not necessarily be distributed according to your wishes.
For this reason, it's important to review your beneficiary designations on a regular basis and update them as needed. For example, you may want to change your beneficiaries if you get divorced, have a child, or simply want to change the distribution of your assets.
The Help of an Estate Planning Attorney
Putting together an estate plan can be a daunting task to attempt on your own, and it can be helpful to work with someone who understands state guidelines that you must abide by when creating your estate plan. At Pacific Cascade Legal, our team of estate planning attorneys can help you craft a plan that meets your needs and protects your family’s best interests.
Learn more about our estate planning services or schedule a consultation by calling us at (888) 981-9511. You can also learn more information by visiting our website.