3 Tips Help You Get Started Planning Your Estate

Posted on: 4 May 2017

Planning for your future is not always a fun task. Not only will you need to worry about your family's emotional well-being, but you must also protect their financial future. This will require purchasing various policies and determining who will be your beneficiaries, but you will also need to ensure your assets are fully protected. Although difficult to discuss, estate planning should occur before something happens to you. With these tips, you will have the tools to start planning your estate.

Do Not Wait

One of the most dangerous mistakes you can make is to wait to save, wait to invest, and wait to plan. In addition, you should never put off having your last will and testament drafted. Establishing a power of attorney is also important for handling your estate if and when something occurs to you.

There are two types of power of attorneys that will are required. A financial power of attorney has the legal backing to handle your financial affairs while a medical power of attorney can make medical decisions on your behalf if you become incapacitated. Thankfully, hiring an attorney can help you get started, but you should not wait.

Procrastinating will leave you and your family in a great deal of physical, emotional, and financial stress.

Do not wait to begin planning for you and your family's financial future. Invest in a company-sponsored 401k as soon as possible. In addition, consider purchasing life insurance policies when you are young. You may not believe you need life insurance in your 20s or 30s, but starting at a young age is a more affordable option.

Life Insurance Is Not Enough

Many people feel having a life insurance policy is sufficient for their final expenses and their family's future financial needs. While it is imperative, a traditional life insurance policy is not enough. Retirement savings, real estate, stocks and bonds, cash, and even precious metals are all beneficial to have as assets. Of course, broadening your life insurance horizons is also smart, since there are various policies available suited to you and your family's needs.

When choosing a policy and payout amount, consider how your family will utilize the insurance. Burial expenses, income replacement, debt repayments, and even wealth accumulation after your death can be accomplished with the right life insurance policy. You can also choose from a whole life, term life, or universal life policy with the latter being a permanent insurance that builds up a cash value over time.

Trust in Your Living Trust

Establishing a living trust is also important when planning and organizing your estate. Your attorney can help you design a trust to include in your will that will legally ensure your assets are managed and protected. Having a trust is especially important if you have children of minor age or adult children who are incapable or not responsible enough to handle your assets. Lastly, you will want to have a living trust to avoid probate fees and protect your assets from a creditor or an ex-spouse.

The majority of your assets should be included in this trust. These assets include cash and funds in bank accounts, oil, gas, and mineral rights, real estate, and retirement accounts. Stocks, bonds, other security accounts held by brokerages, interests in small businesses, any patents or copyrights, valuable works of art , furniture, or antiques, precious metals, jewelry, and other valuable collections are also assets that should be included in your trust.

With proper planning, you can reduce emotional and financial stress for your family. These tips and an attorney's help will help you through the estate planning process. To get started, contact services like Family Focus Financial Group.