We know it’s one of the last things you want to do. According to Forbes, more than half of all Americans lack proper estate planning. Writing a will is more than just sitting down and putting pen to paper. Yes, that will give someone a good idea of what you want, but it won’t tell them where everything is and what to do with it. We’ve discussed what happens when you die without a will. Below, we list the 5 steps for proper estate planning.
Get a good idea of exactly what you have:
Proper estate planning begins by outlining a list of all the assets and liabilities you have. You should account for real estate holdings, bank accounts, stocks, retirement accounts, bonds, cars, boats, life insurance, pensions or anything else you have access to financially. If you have any liabilities you should list that as well. Kiplinger has a handy worksheet that we life to refer people to when the need to calculate their assets and liabilities.
Don’t forget about your kids:
This really goes without saying, especially if you have minor children. If you have children who are under 18, you need to decide who you want taking care of your kids should something happen to you and your spouse. You’ll need to establish guardianship and someone to handle any money you’ll leave behind for them. While you can have their guardian manage both roles, we often recommend that people have a separate guardian for the child and the money to support the child. The primary guardian will be someone you believe will nurture and raise your children in a way that you would. The other person will need to be someone who you believe would make sound financial decisions for your children until they are capable of managing whatever you leave for them. Having a separate financial guardian would also be especially wise if you’re divorced and don’t trust your ex to manage your assets wisely.
Another thing you will want to consider is backup guardians for both the children and any assets you leave your children. In the event that one of the guardians you have chosen dies, is incapacitated or no longer wishes to do the job, you’ll definitely want a backup.
Additionally, you’ll probably want to leave a set of instructions as to you how you’d like your children to be raised. This can be done in writing or via a video. You’ll want to include your views on those things that are very important to you including religion, educational attainment, or anything else you want your kids or those raising them to know. While these types of communication aren’t legally binding, they are a good point of guidance.
Divvying up your things:
After providing for your children (if you have children or wish to actually provide for them) you will want to figure out how you want your assets divided. If you’re married or have children this is a pretty straight forward process. You don’t have to account for everything in the will; if you have valuable or sentimental property, you can leave a list for you executor as to how you’d like that divvied up.
Choose someone to administer your last will and testament:
You will need to choose someone to handle your affairs after you pass and you will need to speak with that person and make sure that they’re OK with doing this. The administrator or executor of your last will and testament will have to distribute your assets and make sure any and all taxes and debts are paid. Your executor needs to be someone you trust to do the job of handling your final affairs. You’ll also need a backup in case the primary is unwilling or unable to complete the duties of executor. If you don’t have a backup, the court can choose one for you and that person may not even have a clue who you are.
Finally, proper estate planning requires a competent attorney:
You don’t want to trust just anyone to set up your will. Generally speaking, a competent general practice lawyer will be able to do simple wills and other estate planning documents. On average you should pay between $275-500 for a simple will and around $150 each for a medical directive and power of attorney. While each attorney charges different prices, this is the average of what a simple will costs in our area. If you find that your estate is too vast or has too many assets, you will want to see someone who specializes ONLY in estate planning. We have several here at Harmon and Gorove we recommend. Should you need a complicated trust or have an extensive and valuable estate, you can expect to pay $200 per hour or more to have a specialist take a look at your estate and craft a plan that will maximize your needs.
Everyone needs some kind of final estate plan. It doesn’t matter whether you’re 18 or 80, proper estate planning can make life easier for those you leave behind. It makes your wishes clear to those you love and who loved you in a time if grief and change. The attorneys at Harmon and Gorove have helped thousands of people craft their last will and testament in a low stress and cost effective environment. Contact us today to schedule an appointment to speak with one of our compassionate and competent attorneys about how you can prepare for your future today.