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Estate Planning BasicsOctober 6, 2020
Estate planning isn’t only for the extremely wealthy. Anyone who has assets, dependents, or an interest in how they are cared for when they age should consider a form of estate planning.
More than half of the population leaves no formal plan in place for their loved ones when they pass. Familiarizing yourself with the basics of estate planning can save you and your loved ones unnecessary grief during an already difficult time.
Estate planning is the process of determining what happens to everything that belongs to you or that you’re responsible for in the event of your incapacitation or death. It covers far more than just your wealth. An estate planning document can include directions for many aspects of your life.
The components of an estate plan can include:
- Guardianship of your dependents - specify the person or people who will assume legal care of your dependents should you become incapacitated or die.
- Distribution of your assets - detail exactly how all of your assets will be divided and to whom they will go, whether they are cash, property, or otherwise.
- Charitable giving - outline the amount of money or assets that will be donated to charity in the event of your incapacitation or death.
- Business transfers - If you are a business owner, determine the person or people to whom you will leave your business (or the value of your business).
- Health care directives - outline your wishes for decisions that may need to be made should you be incapacitated and unable to make these decisions yourself. This section may also include designating a person to make health decisions for you should you be incapacitated.
- Directions for your final arrangements - describe your wishes for funeral or other end-of-life services. For example, this would describe whether you would prefer cremation, burial, or another option.
For more on getting started with estate planning visit here