Estate planning is when you create a formal and legal plan for managing and controlling your estate after you pass or if you suffer severe incapacity. Here are the basic steps you must take to indisputably go through the estate planning process.
Identify all your assets
List down everything you own. Often, you only realize the extent of your assets and liabilities once you make a detailed inventory. Only then can you divide your estate adequately.
Protect your income
If you are a breadwinner, you can purchase life insurance plans. Protecting your income through insurance coverage will allow your family to maintain their current standard of living.
Name your beneficiaries
Insurance plans and retirement plans will require you to name beneficiaries upon inception. But they cannot encapsulate your entire estate. A valid will or trust can give you a medium to legally distribute all your estate assets in the manner you decide.
It would be best to name a guardian to care for your minor children and pets. A will is where one would typically name their guardian. You can choose multiple guardians with varying responsibilities that you must explicitly outline in your will.
Choose your estate plan
Carefully study the estate plans available to you. You may choose multiple ways to address different aspects of estate management and administration. A comprehensive estate plan will even address issues that pertain to your life-sustaining treatment and medical decision-making in case you are no longer capable. You can grant someone the legal authority or power of attorney to act on your behalf.
Assign a personal representative
In Florida, a personal representative is a fiduciary to the will, similar to how trustees are fiduciaries to a trust. They owe a duty to the surviving beneficiaries named in the will. Granting fiduciary duty and powers to an individual is a huge responsibility. They will have control of your estate, so make sure you can trust them. Try to choose someone competent and organized. Communicate your intentions to the person.
Get your estate plan in writing
A written and notarized document is the most secure way to establish a valid and legal estate plan. Keep your estate plan document safe in a place where your beneficiaries can easily access it.
Keep your estate plan updated
Review your estate plan now and then so you can update it accordingly. Our circumstances in life are ever-changing. Your estate plan should reflect your life now and the future you envision for your loved ones.