It is incredibly important that every adult has an estate plan for when they pass away. Too many people think that this directive doesn't apply to them and so they put off getting their estate plan even though it is dangerous for them. Here are some things you should know about wills, trusts, and estate plans.
1. A Will Is Important For Your Children
If you have children, you must have an estate plan! In the past the will be used to have all the information about your money. Now that is not the case. Instead, as discussed later, trusts are where you should keep all of your money. A will is where you will have all of the information about what you will do with your children and any directives you have for people.
Could you imagine if something happened to you and there wasn't a will? What would happen to your children? The state would decide where they will go, rather than you choosing the best option for them. You know your children better than anyone else, and you know your family dynamics. Perhaps you don't want them to be cared for by a certain person and would prefer another family to have them. Without a will, there is no way to know, and so they will make these important decisions.
2. Trusts Will Organize Your Money
Trusts are the way that money is organized in your estate plan. A trust is great because it gives you more protection from taxes, it will save you money on lawyer fees because it avoids probate, and it will allow you to have more control. With a trust, you can tell people exactly how you want the money to be used, where you want your money to go, and if there are contingencies to getting the money. For instance, you will only pay for your child's college tuition if they maintain a certain GPA, and so forth.
3. Power Of Attorney's Are Important For Every Individual
Once you reach the age of 18, you need to make sure that you are prepared for the worst-case scenario. Assume that you are in a coma, who would make all of your financial, legal and medical decisions? When you create a power of attorney it will say who can make decisions for you, this way you know that the person who is in charge shares your same ideals and same beliefs.
As you can see having an estate plan is important for every adult. For more information on wills and trusts, contact a local estate planning service.