Estate planning is making arrangements for managing and disposing of your assets after your death. It can be complex and daunting, but it’s essential to put some thought into it to ensure that you carry out your wishes and that your loved ones are taken care of.
There are three fundamental procedures you must follow when estate planning:
1. Make a Will
This is an essential step in estate planning. A will is a legitimate document that sets out your wishes for how your assets should be distributed after death. Without a choice, your state’s laws will determine how your assets are divided, which may not be by your wishes.
2. Designate a Power of Attorney
Your power of attorney is a legal file that gives someone else the authority to decide on your behalf if you become incapacitated. This could be decisions about your finances, healthcare, or other vital matters.
3. Make Arrangements for Your Funeral
While it may be unpleasant to think about, making arrangements for your funeral in advance is essential. This will ensure that your loved ones are not burdened with making decisions about your funeral at a time of grief.
Making these three arrangements is the best way to establish that your wishes are handled after your death and that someone you love is taken care of.
Is Estate Planning Important?
Estate planning is vital for a variety of reasons. Here are three fundamental reasons you must consider estate planning, regardless of age or financial situation.
1. Estate Planning Can Help You Protect Your Assets
If you pass away without any will or estate plan, it will distribute your assets based on your state’s intestacy laws. This means your assets may not go to the people or causes you intended.
By creating a will or trust, you can ensure that they distribute your assets according to your wishes. You can also use estate planning tools to help protect your assets from creditors or predators.
2. Estate Planning Can Help You Minimise Taxes
Your heirs may face a significant tax bill if you have a large estate. However, several strategies can be used to minimise or even avoid taxes on your estate.
A competent estate planning lawyer can help you take advantage of tax-saving opportunities, such as gifting assets to charity or setting up a trust.
3. Estate Planning Can Help You Plan For Incapacity
If you become incapacitated, someone will need to make financial and medical decisions on your behalf. If you don’t have an estate plan, it may be up to the court to decide who that person will be.
An estate plan can include documents such as a power of attorney, which lets you appoint someone to conduct financial decisions on your behalf, or a living will, which outlines your wishes for medical treatment if you are incapacitated.
Estate planning is a must for everyone, regardless of age or financial situation. By planning now, you can ensure that your assets are protected and that your wishes are carried out.
Conclusion
These three real estate planning procedures must be followed: creating a will, setting up trusts, and designating beneficiaries. Doing so can help ensure they distribute your assets according to your wishes and avoid potential probate issues.
If you are looking for a financial advisory firm that is up-to-date with the latest technologies and can tailor the estate planning process, then New Wave Financial Planning is the firm for you. We are based on the Gold Coast but serve local and nationwide clients. So if you require financial advice, don’t hesitate to contact us.
