Make Sure Your Estate Plan Is Up-to-Date

“Estate planning? Me? What do I need an estate plan for?” That is a common sentiment among many of us. You may be surprised to discover, however, that everyone needs an estate plan, regardless of the size of his or her bank account.

A proper estate plan can be simple or complex. It takes into consideration your assets, your dependents, special circumstances such as divorce, and any specific wishes you may have.

Wills and Trusts
A will is the most basic form of an estate plan. It is a legal document that determines how your assets will be distributed and who will care for your children in the event of your death. A simple will developed with the help of an attorney may be enough to cover your needs; however, you should be familiar with how it works.

Wills go through probate — a legal process that can cost your heirs significant time and money. Wills do not cover your needs if you become disabled, and they are public documents, which means any curious party can gain access to your will after your death.
Those are some reasons why you may want to consider a trust in addition to a will. A trust is a legal arrangement that affords you control of your assets not only after your death, but during your lifetime as well. Trusts can also help you save tax dollars and maintain privacy, and they can save your heirs time and money by avoiding probate.

A living will is another estate planning tool. It identifies your wishes for health care decisions in times of crisis. A living will ensures that your wishes are carried out while helping to ease the anxiety of medical decision making for your family members.

When to Update Your Plan
Your estate plan should be updated as your life changes — when you move to another state, get married, or have children, for example. Divorce can have especially complicated effects on your estate plan — in some cases revoking elements of your plan entirely. You should also revisit your plan if your financial situation changes dramatically.

Next Steps
While estate planning is a very important component of your overall financial plan, it can also be a complex endeavor. Therefore, all of your estate planning decisions should be made with the help of a qualified legal professional.

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