Financial Planning WTFinance: Estate Planning Read the Article Open Share Drawer Share this:Click to share on Twitter (Opens in new window)Click to share on Facebook (Opens in new window)Click to share on Tumblr (Opens in new window)Click to share on Pinterest (Opens in new window)Click to share on LinkedIn (Opens in new window) Written by Dan Miller Modified Jun 21, 2022 4 min read Sources Advertising Disclosure The views expressed on this blog are those of the bloggers, and not necessarily those of Intuit. Third-party blogger may have received compensation for their time and services. Click here to read full disclosure on third-party bloggers. This blog does not provide legal, financial, accounting or tax advice. The content on this blog is "as is" and carries no warranties. Intuit does not warrant or guarantee the accuracy, reliability, and completeness of the content on this blog. After 20 days, comments are closed on posts. Intuit may, but has no obligation to, monitor comments. Comments that include profanity or abusive language will not be posted. Click here to read full Terms of Service. Save more, spend smarter, and make your money go further Sign up for Free At its most basic, estate planning is a series of documented decisions for what should happen to everything you own if you pass away. A common artifact of estate planning is the creation of a will, which is a notarized document detailing how your assets should be disposed of. As you get older and your estate gets complicated, you can upgrade your will to include a living trust, powers of attorney and other estate planning features. In this edition of WTFinance, we’ll take a look at estate planning, why it’s important and how to get started. What is Estate Planning? You might normally think of financial planning as how to grow and protect your assets throughout your life. But an important part of making a financial plan includes making a plan for what happens to all of your assets when you die. A simple estate plan could include just a simple will, leaving all of your assets to one or more beneficiaries. But as you accumulate more assets or as your financial situation gets more complicated, you can also upgrade your estate plan. Depending on your financial goals, you might want to create a living trust, which can have tax benefits as you think about your inheritance and legacy. Setting up medical or other powers of attorney is also a good idea as you get older — that way if you find yourself in a situation where you aren’t able to make your own decisions, you can delegate that responsibility to someone you trust. Why it’s Important to Have an Estate Plan If you’re just starting out or don’t have many assets, you might think that there is no need to bother with an estate plan. The truth, however, is that there are no advantages and many disadvantages to dying intestate (without a will). Just about anyone with any assets needs to have a will. Even if you don’t have very many assets or think that it should be very straightforward that everything you have will go to your spouse, parents or children, that’s not how the probate system works in most locations. If you die without a will, it might take weeks or months before your loved ones can access some of your assets. You don’t want to cause your loved ones any additional grief or anguish by not having an adequate estate plan. When You Should Start Planning For Your Estate You should start an estate plan as soon as you are living on your own or have any assets in your own name. A simple will can be a good start if your estate is small. You can use will preparation software or consult with a lawyer to make a will. Make sure that you check your state’s probate laws to see what is required to make a legal will in your state. As your estate grows, you might consider making a living trust as a part of your estate planning. A living trust is not the same thing as a will, but both types of documents can play an important part in helping you plan for how you would like your assets divided in the event of your death. How to Get Started With a Basic Estate Plan The biggest reason that most people don’t do any estate planning is because it can feel overwhelming. It’s easy not to make estate planning a priority, especially if you’re not sure how to get started. If you find yourself in that situation, here are some basic steps to create a simple estate plan: Inventory your assets — include big ticket items like your home, cars, jewelry as well as sentimental items that you want to pass down to specific peopleDetermine your beneficiaries — you might want most of your assets to go to a spouse, parents or children, but you can also make specific bequests of individual items as you see fitUnderstand your state’s probate law — laws for how to make a will vary by state and jurisdiction; make sure you understand what makes a legal will where you liveDraft and sign your will — you can use will software, an online site or consult with a lawyer, depending on how comfortable you feel with each optionReview your plan regularly — times change and your estate plan should change with them. The Bottom Line If you have any assets at all, you’ll want to make sure that you have a plan for your estate. Even creating a simple will, naming your assets and beneficiaries, will be enough to keep your estate out of probate court. This can simplify the process for your loved ones during what would be a very stressful time. If you don’t have a will or estate plan, make it one of your financial goals this year. Save more, spend smarter, and make your money go further Sign up for Free Previous Post What is the FIRE Movement + How to Make It… Next Post How To Build Generational Wealth Written by Dan Miller Dan Miller is a freelance writer and founder of PointsWithACrew.com, a site that helps families to travel for free / cheap. His home base is in Cincinnati, but he tries to travel the world as much as possible with his wife and 6 kids. More from Dan Miller Follow Dan Miller on Facebook. Follow Dan Miller on Twitter. Sources In this edition of WTFinance, we'll take a look at estate planning, why it's important and how to get started. Comments are closed. 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