Though most adults in the United State do not have an estate plan, ideally everyone over the age of 18 should. According to The Motley Fool, estate planning is an opportunity to provide for loved ones and protect your own interests in the face of life’s inevitabilities.
Every estate plan is individual to the person who creates it. When making an estate plan, it is helpful to decide what goals are most important for you to achieve. Your estate planning priorities depend on your own situation, but here are some ideas to help you get started.
1. Planning for potential incapacitation
Estate planning does not pertain exclusively to what happens after your death. You may want to include a living will and/or power of attorney in the event that someday you are no longer competent to make your own health care decisions or able to communicate them effectively.
A living will allows you the advance opportunity to either accept or decline extraordinary lifesaving measures. A power of attorney gives an agent of your choosing the ability to make decisions on your behalf regarding health care and/or financial matters.
2. Identifying who needs protection and provision
You may have individuals who rely on you, such as minor children or incapacitated adult family members. You can ensure that their care and maintenance continues even if you are unable to provide it yourself through estate planning. You can name a guardian for your children in your will and set up a special needs trust to provide for a loved one without hurting his or her benefit eligibility.
3. Thinking about avoiding probate
Probate can be both a lengthy and costly process, especially if you have a large estate. Probate avoidance is not a priority for everyone, but you should decide whether you would prefer to spare your loved ones the trouble and expense with estate planning tools such as living trusts.