Your parents may have achieved senior citizen status, and the subject of powers of attorney has come up. These agreements can take many forms; understanding how they work in certain situations will be helpful when you begin to talk with your parents about their future care.
Someone brought up the subject of wills recently, and asked if you had one. You said no. Your friend chattered on about trusts, powers of attorney and medical directives, but you lost interest in the discussion.
Preparing for the death of a loved one is difficult emotionally and mentally, and there are actual physical and financial challenges that may make it even harder. If a loved one dies without a will or estate plan, it can be extremely difficult to get financial affairs in order, and this often causes fights and backlash between family members. If a home is not included in a will, it may fall to the next of kin to go through possessions and get the house ready to sell, which can be a huge job. Then it must be determined who pays the taxes and realtor fees, and who inherits the money made from the house. This can be a difficult time for everyone, and it is almost always made easier when the parent is financially and legally prepared to transfer ownership to children or next of kin.
Naming an executor is not a job to be taken lightly. Depending on the size of your estate, the responsibilities this person must eventually undertake could be relatively light, but those obligations could also be complex and therefore quite time-consuming. When you die, the distribution of your assets might take two years or longer due to the amount of work involved.
Year end is not only a good time to reflect back on your year, but to also make sure you've planned for the future.
Even though people are living longer in today's world, there is always a chance that life will end when you least expect it. Those who are prepared have a will to ensure that their assets and possessions go where they want them to go. The first part of planning an estate is preparing a will, and what is included in that will is some of the most important decisions you will make in your lifetime.
No two estate plans are ever the same. At least that's what most estate planning experts will tell you. That's because an estate plan should be as unique as the individual drafting it. It should really reflect a person's life events - such as having children or remarriage - and what they want to happen to their estate when they pass.
Most people don't like thinking about the end of their life, let alone what will happen to their possessions, assets and debts after they have passed. Sadly, that's exactly what an estate plan forces us to do.
Have you ever found yourself saying, "I'm not old enough to even think about making a will or an estate plan?" If so, you're not alone. Many people believe that an estate plan is only for people reaching retirement age or those who have a substantial amount of assets that need to be accounted for upon their death. This isn't true, though.