The Basics of Estate Planning
So you know that you need an estate plan, but you’re not really sure to get started. Or perhaps you’re not sure if a particular aspect of estate planning even applies to you. This article reviews some basics in the foundations of planning your estate and should spark your interest in setting up the plan that works for you.
Start With The Will
The will is essentially the cornerstone and base of your financial and estate planning. Without it, your individual desires and requests are not guaranteed and protected. Your will outlines your plans for the distributions of both assets and property on your death, and it should always be updated to reflect your most recent wishes. It is not uncommon to revise a will several times (for example, as family sizes grow or as assets in your name are changed). When you pass away, an executor will be appointed to carry out the process of estate administration. The will is so important because it lays out the framework for what will happen after you pass away, giving you some control in the matter.
Sometimes, a trust is a valuable answer to your estate planning problems. The goal of a trust is to pass on or transfer assets over to another person, and the trust is managed by a trustee. There are many different purposes for a trust, depending on your individual motives. You can set your own conditions based on how and when the motors should be transferred and reduce the delays associated with going through the probate process.
Living Will/ Medical Power of Attorney
A living will or healthcare proxy is an advanced medical directive articulating your desires in the case that you become unable to verbalize your wishes. If you become terminally ill, unable to communicate, or otherwise incapacitated, your health-care proxy will be the official document determining the next course of action. Generally, each state will have a statute stipulating when a health-care proxy becomes active, so you’ll want to speak with a New Jersey expert to be sure you’re clear on the exact rules and regulations for that state.