If you want peace of mind, start planning your estate now. Estate is a fancy word, but don’t let it scare you away. It’s simply the word that encompasses everything you own, from your insurance policies to your home. The estates of most Americans are not large, but more in the modest range.
Writing a will is just one part of estate planning. Decide what your estate planning goals are, and the value of your estate before you sit down to write your will. When done successfully, your will ensures that your property will be legally transferred to whomever you wish. It will also protect your estate from the claims of creditors you may own money to at the time of your death.
Your will can also help protect you and your estate should you become mentally or physically incapacitated. No one wants their estate to be depleted by medical costs. You can spare your family and any beneficiaries from this fate by putting time and thought into the making of your will.
1. Begin Writing Your Will
Begin the writing of your will by thinking about what you own and how you would like for it to be divided. Seek out an attorney to help you put these things in writing and to advise you on all of the legal statutes of your state. When you feel you have a good store of information, simply take a piece of paper and begin writing. You’ll probably make many changes as you go along; when you have most of what you want to say down on paper, contact the attorney of your choice and begin to put together your legally valid will.
2. Take Inventory of Your Assets
This is the basic first step in your estate planning process. The inventory of your assets will give you and your attorney an idea of the size and complexity of your estate. Even if you have a very modest estate, or your only goal is to write a simple will, you still need to take an inventory of all of your assets.
3. Use an Asset Inventory Worksheet to List Your Assets
Make use of an estate planning worksheet, which has an asset inventory section, when you want to list your assets. Here you can list and describe everything that you own either completely or partially. You should list things of value, like jewelry, property, vehicles and your home.
4. Indicate How You Own Each Asset on Your Worksheet
When taking your inventory, you may realize that you own some assets outright, but only own others partially. This is often the case in real estate. You should also check with your state to find out their laws on community property.
4. Record Percentage and Net Value on Your Worksheet
Indicate what percentage of each asset you own. Also show what the current market value is of each asset. The current market value is what you could sell the asset for on today’s market. All assets are either separate or community property.
5. Estimate the Net Value of Your Estate
You can determine the net value of your estate by adding up all of the values of your assets and subtracting from that amount the total value of all your liabilities. Be sure to review your estate plan on a regular basis because your assets and liabilities will change over time, affecting your net worth.
6. Choose an Executor
An executor is the person who acts as the legal representative of your estate after you pass away. Your executor will do such things as locate your will and collect your assets. Designating your executor is a very important step, and could be a close friend, a family member or an adult child, for example.
7. Choose an Alternate Executor
It’s a good idea to have an alternate executor in case your first choice for executor cannot carry out his or her duties. An alternate executor is legally entitled to receive the same fee for acting as your legal representative as the main executor. It has to be spelled out whether or not an executor will be paid and the fee will be paid by your estate.
8. Make Your Executor’s Job Easier
One of the things you can do to make the job your executor has to do easier is to make sure your will is legally valid. If you’ve gotten the appropriate legal help, this shouldn’t be an issue. Be sure to go over your will with your executor and answer all of his or her questions. Inform them about where you keep your will and give them an unsigned copy.
9. Name Your Beneficiaries
Beneficiaries are people or organizations you leave your property to. A beneficiary can be anyone from your spouse to your alma mater. The person or entity you choose doesn’t have to be one of your heirs, which is someone legally entitled by state law to inherit from you.
10. Leave a Special Message in Your Will
Your will doesn’t have to be full of dry legal jargon. Many people choose to include special messages to loved ones, friends and acquaintances. These messages can let someone know how you felt about them or how much you appreciated them. Whether you have a lot of valuables to leave or not, consider giving the gift of a personal message.
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