It seems strange to think about estate planning when you’re young. People usually think of it being something that only older, retired individuals need to do. That can be a mistake though. Everyone should have an estate plan, and it doesn’t have to be anything very complicated. Some estate planning moves are incredibly easy.
Writing a Will
Does the thought of writing a will conjure up images of hours spent in a stuffy office as you pour over paperwork and fine print? As it turns out, writing a will could be a lot easier than you think. You might be able to write a will online. This typically works best for people who have simple estates with limited assets and a low risk of contestation. Not all online writing resources are valid in all states, so make sure your chosen method will be valid before committing to it. If you have minor children, it may be worth spending the money on a lawyer. That way your wishes regarding their guardianship are more likely to be carried out as you’ve instructed.
Setting Up a Trust
Do you have possessions or assets that you want to be passed on to specific people? If so, setting up a trust could be the best move to make. Start by figuring out what sort of trust you want. It’s important to weigh whether you want a revocable living trust or an irrevocable trust. There are pros and cons to both options. Without a revocable living trust, transferring your home to your heirs can get complicated. That said, an irrevocable trust could reduce estate taxes since the assets in the trust technically belong to the trust, not your estate. Once you know what sort of trust you want, create the appropriate document and have it signed and notarized. Set up the bank account for it and transfer the assets or name the trust as the beneficiary. If the DIY process doesn’t appeal to you, hire a financial advisor to guide you through the process of setting up a trust.
Making Your Bank Account Payable upon Death
Who is the beneficiary of the money in your bank account when you pass away? If you want them to have access to your account when you pass away instead of letting it go through probate, make the account payable upon death. All it takes is filling out a form with your bank or credit union. Upon your passing, the beneficiary will need to provide the bank with an ID and a certified copy of your death certificate.
An estate plan can be beneficial for pretty much anyone. It helps make sure your belongings and assets are distributed the way you want them to be after you pass away. It also helps minimize taxes, legal hassles, and other expenses. An estate plan may not be necessary for many years, especially if you’re young. Still, no one knows what life holds in store. It’s always better to be prepared.
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