What is Estate planning?
A person’s estate refers to all the property or assets owned by a person. These include real estate, cash, investments, vehicles, insurance, and other belongings. What happens to An Estate after a deceased depends on whether that person has planned his estate. Therefore, one must understand what document one needs for estate planning.
However, planning how your estate should go once you pass away is known as Estate planning. This is because you can decide how much your estate will pass on, like properties, personal belongings, financial investments, and assets. Not only that, but you can also choose the beneficiaries who’ll end up inheriting your estate after your demise.
This is a dynamic process that needs to be checked at regular intervals. To absorb any changes that may have happened during your lifetimes. One can plan an Estate with the help of an attorney who specializes in estate law.
Document required for Estate planning
Will is the legal document in which you specify who you want to inherit your assets and properties after your demise. This may include how you want these assets to distribute and who will be the beneficiaries of these assets. In your will, you can also name the guardians for your pets or minor children. When drafting a choice, you must choose an executor who manages your assets. Will they ensure that your instructions will have been followed after your demise?
Revocable living trust
A revocable living trust is a legal document letting you distribute your assets after your demise. This acts as a legal entity that owns the property or helps you put it into it while allowing you to control and use it while you’re alive. A revocable living trust is more complicated to maintain than a will but allows your assets to avoid the process of probate after you die. In addition, this permits the distribution of your investments quickly and privately.
To implement a revocable living trust, you must first create, sign and notarize your trust document. Then, you’ll have to name a successor trustee who’ll manage the trust after you die. After all this, you should transfer your property to the trust.
A non-probate asset can bypass probate and transfer to a beneficiary without going through the probate process. These include 401(K) accounts, pensions, and life insurance policies. For these assets, you must contact each institution where you have a non-probate help and name a beneficiary. These items are not listed in your will as beneficiary designations override your choice.
Power of Attorney (PoA)
Power of Attorney refers to a person or an agent you can assign to act on your behalf. This gives the person the legal authority to manage your finances, property, real estate, or any other financial transaction on your behalf. This type of PoA is revocable till the person who chooses the PoA is mentally and physically capable of doing so.
Another kind of power of attorney may include the health care power of attorney, which can make medical decisions on your behalf.
Insurance policies and financial information
While planning your estate, you should keep information regarding your insurance policies and other financial documents, such as bank accounts, debts, loans, taxes, and investments, in one place. This information includes in your estate planning documents.
If you have minor children or have pets that may require someone to care for them, then picking a guardian is essential. So it would help if you chose a guardian with all possible designations.
Property and titles deeds
You must ensure that you have all title and deed documents of all your properties. For example, if you have created a trust, then that trust should be listed in your deeds and the property titles.
Letter of intent
You are leaving a letter of intent to a beneficiary or executor. The letter of intent may state your wishes regarding a particular asset or wish fulfilled after your death.
Suppose a person has pre-existing pre-nuptial agreements or has some existing contract. Then they can include those during the estate planning. Also, their digital vault passwords will change if the person has digital accounts or digital assets.
In this blog, we learn about the various document that one needs for the estate planning process.