John J. Bowman, Jr. in Personal Finance and Investing, Economists and Finance, Finance CEO • Bowman & Associates Nov 9, 2020 · 1 min read · +400

Estate Planning Simplified

Estate Planning Simplified

Originally published to JBowmanAccountant.org.

Nobody likes thinking about dying, but, if you die without a plan in place, you’ll be leaving your assets and your family in a difficult position. In that case, you’ll be taking the chance that the state’s probate laws will work in your family’s favor. It’s much more advantageous to develop a simple estate plan.

Start With a Will

Above all, you need a will to ensure certain arrangements will meet with your approval. Even if you don’t have many assets, you should use your will to identify your heirs and determine how assets will be divided up among them. More importantly, a will is the only way you can choose guardians for your minor children and make arrangements for their care.

Add a Living Trust

Your estate plan should also include a living trust. If you have significant assets, or if you want to make sure a loved one receives a specific piece of property, a living trust will serve this purpose better than a will. Since a trust is a private document, it typically won’t be included in the probate process. This means any property transferred via the trust will also be kept out of the probate process.

Care for Yourself With Powers of Attorney

An estate plan can also help you take care of yourself in the future by helping you choose people to make medical care and financial decisions for you. A healthcare proxy allows you to choose someone you trust to make decisions regarding your healthcare if you’re ever in a situation in which you can’t communicate your wishes. Under those same circumstances, a financial power of attorney will appoint someone of your choosing to take care of your finances until you’re able to act on your own behalf.

While you could probably create a simple will that’s legally binding, it’s a smarter move to consult an estate planning attorney. An experienced lawyer can help you draft the other documents you’ll need for your estate plan, and they can explain how the laws in your state will affect your final wishes. Creating a simple plan for the future may seem bothersome, but you’ll be surprised by the peace of mind it provides once it’s done.