What Every Retiree Needs To Know About Estate Planning
Having a smart estate plan is essential for everyone, regardless of assets, age, or income. You might think estate planning is something you can put off until your later years, or that it’s just for the majorly affluent. However, setting up a clear path for what happens to your property and your family after you pass can make life for your heirs much easier in a time of stress and grief.
That’s where an estate plan comes in. It’s your chance to really take control of how your property is going to pass upon your death. Here’s what you need as part of a solid estate plan, no matter your assets, age, or income:
This basic legal document will set up who will get what without the state having to step in and make those decisions. A will is especially important if you have children who are minors, and are a single parent. If you don’t do any planning for your children, they will go into a guardianship while the legal system sorts out who your children will live with in the future. Plus, a judge may decide on a guardian you wouldn’t have chosen or wanted. By having a will in place that establishes your children’s guardians in case something happens to you, you can ensure that they will be raised by whomever you see fit.
A trust can do a couple of important things. First, it means your estate will not go through probate, a process that can delay assets being passed on to your heirs. This is helpful if you hold properties in more than one state, because your estate would be subject to separate probates in each state. A trust can also be set up for special needs or minor children. It will determine how the assets they inherit will be used to support them, who will make those decisions, and when the children can take over that fund themselves, if ever.
Powers of Attorney
If something happens to you and you can’t make decisions for yourself, who is in charge? Who will make sure that your bills are paid and that medical decisions are made with your best interests and wishes in mind? Your estate should determine who holds your medical and financial powers of attorney. Keep in mind that those roles may be held by two different people if needed.