There are many reasons why you may want to make sure you have a plan in place to pass your assets to those you love. Estate planning can be important for many families, especially when people think about aging, plan for children or make changes in their lives. You may want to reduce the burden on your loved ones and provide for them while ensuring that the assets that you worked so hard to build are protected. Estate planning provides an array of useful tools to help you achieve your goals, but it may be important to avoid some common pitfalls in order to achieve your goals.
Keeping your estate plan up to date
There are a number of documents that can help you build an effective estate plan, including wills, trusts and powers of attorney. Of course, the first step in having a successful plan is having these documents in the first place. Powers of attorney may be particularly important in case of a sudden health emergency or another form of incapacity because they allow you to name a trusted person to handle your health care and financial decision-making. A will, of course, provides a mechanism to pass your property to loved ones after death. Having these documents and keeping them up to date after significant changes like marriage, divorce or childbirth may save your loved ones considerable time and money and allow them to focus on family.
Remember your beneficiary designations
While having a will may be very important, many of your most important assets may be transferred through simple beneficiary designations. These are used to determine the person who may inherit retirement funds, investment accounts, life insurance policies and other key assets. Reviewing and updating these designations on a regular basis and after any substantial events may help to avoid serious problems and family conflicts.
By reviewing your plans for the future, including your estate documents and beneficiary designations, you may help to ensure they are up-to-date and accurate. An estate planning attorney may provide advice and guidance to help you craft an efficient and effective plan.