Getting old is all part of life and though it has its perks, there’s a lot of responsibility that comes with becoming part of old-age crew. From contacting senior placement agencies to find a caring residence to dealing with health issues, there’s a lot to face as we get older.
One thing that many seniors like to avoid is estate planning. Not only is it tedious, it forces us to face our mortality. Though the process can be a bit overwhelming, estate planning ahead of time makes life much easier for not only you, but your loved ones.
Here are 5 must-dos when estate planning to ensure that you’ve touched on the most important elements.
1. Inventory Your Assets & Liabilities
No one likes the idea of having their family fighting in court over your estate. One of the first steps to take in estate planning is to take a holistic inventory of your assets and liabilities. You’ll want to consider all options including:
- Life insurance policies
- Owned assets
- Bank and retirement accounts
- Valuable items
Once you know what assets you own and their value, the next step is to look at your liabilities. This mostly includes debt and loans such as a mortgage or a car loan. By taking an inventory of your assets and liabilities, you and your family will have a clear picture of what you have and what you owe.
2. Choose an Executor
As you start to develop a plan for your estate, choose someone to act as the executor. This could be a family member, an attorney, or even a corporate trustee. The right executor for your estate depends on your assets.
Upon choosing an executor, you will also want to choose someone who has power of attorney over you. In the event that you were to become incapacitated, it’s important to have someone selected to make medical decisions on your behalf.
3. Choose Your Beneficiaries
If you have a large family, such as several children or siblings, it’s important to determine who you want your beneficiaries to be. These are the people who will be given your assets after you pass away. Be sure to notate these people on your life insurance policies and retirement accounts.
It’s also just as important to determine what and how each beneficiary will get what you leave to them. You may choose to have each beneficiary receive their part of the estate outright, or you could set up a trust.
4. Establish End-of-life Documents
There are three main end-of-life documents that you’ll want to have written as you enter your senior years. The first is a durable power of attorney. This allows a designated representative to manage your finances along with any legal affairs.
The second document is advance directives. This names a representative who can make medical decisions on your behalf in the event that you become incapacitated. This should also include a living will.
Third you’ll want to have a signed release-of-information form which gives doctors the ability to legally share your medical records with your designated representative.
5. Consult an Attorney
Estate planning without legal advice from an experienced attorney can muddle the process. Unless you have a very simple estate, it pays to consult with someone to walk you through the process to ensure that you’ve covered all of the important elements. With all of the documentation you’ll have to create and sign, it helps to have someone at your side to help with all of the nuances that are easily missed.
Estate planning makes life much easier for you and your family. Though the process is quite tedious, it’s well worth avoiding the future legal battles.