Estate planning organizes how your wealth gets distributed after you die, and it generally involves professionals such as an attorney and your financial advisor. Simply put, your estate plan says what happens to your things when you die. “Your things” includes your home, real estate, money, other financial accounts, investments, car, furniture, and any other personal possessions. An estate plan can also include instructions for passing on your personal values, for your care if you can no longer care for yourself, provision for and guardianship of minors and dependents, and much more.
Who Needs It?
Everyone needs estate planning because at some point, as uncomfortable as the thought might make us, all of us will die. And because we don’t have control when we die, it is best to be prepared now. Even if you have very little, you should consider what plan you have in place for your possessions.
Why Is It Important?
Too many of us have seen what happens to a family when loved ones pass and their wills are unclear. Fighting occurs, sides are chosen, and families break apart instead of coming together at the passing of their loved ones. Proper planning will ensure your will or trust correctly states your wishes for others to follow when you are gone. Also, if you have dependents, you have the power now to make sure that they are well taken care of both financially and emotionally after you die. If you do not set up a plan for your estate, often the State determines who will receive your assets. Even during your lifetime, if you become mentally impaired, a court appointee will ultimately be the one able to make these decisions for your loved ones.
So, What Is It?
Estate planning usually involves developing a will or a living trust. Though you should consult with a financial advisor and estate planning attorney to help determine the best option for yourself, you should know that many people choose a living trust instead of a will because under a will the assets take time to be distributed and the estate has to go through the probate process. Probate is the court-supervised process of gathering and distributing the deceased person’s assets, which can often take months or years to be given to your beneficiaries.
A trust, on the other hand, can be written to be valid in every state and keeps your estate private. Furthermore, under a trust your estate does not have to go through the probate system. You can change your revocable trust anytime during your lifetime, and even though a trust is usually more expensive than setting up a will, the benefits of a trust can far outweigh the cost. When it comes to providing for your loved ones, choosing the best option is paramount.
Estate planning not only assures that your loved ones are taken care of and your possessions are distributed as you wish, but it also gives you the opportunity to get your financial assets and legal agreements organized. Being organized helps you now and is worth the time you invest in building a plan. Additionally, because any debts you have might pass on to your loved ones, estate planning can make you more aware of your financial situation and perhaps bring about the making of a plan for paying off your debts now, giving you freedom from your debts while you’re still alive.
Contact Our Financial Consultants
You can’t control when you die or what happens after you die, but you can do your part not only to help your family avoid unneeded drama, but also to provide for those you love with the assets you have. Contact the financial consultants at Alpha Fiduciary’s office in the Scottsdale and Chicago areas for your estate planning needs. We have experience, professionalism, and knowledge to help you with your financial needs. Call us and speak to a financial consultant today!