First, what is an estate?
Your estate is simply everything you own—your home, other real estate, bank accounts, investments, retirement benefits from your employer, IRAs, your insurance policies, collectibles, and personal belongings.
When you start adding it up—especially when you add in the death benefits from your insurance policies—you may find, like most people do, that you actually own a lot more than you think.
Now, why do people do estate planning?
Most people do estate planning because they want to control who will receive their assets after they die, and they want this to happen with the least amount going to legal fees and taxes.
But estate planning is not just about what happens after you die. A good estate plan will also protect you at incapacity. It will let you—not the courts—keep control of your assets and control of decisions about your medical care when you can no longer handle your own affairs.
So, who needs to do estate planning?Everyone.
Certainly, the older you get, the more you start thinking about how to transfer your assets to your grown children or other loved ones.
But families with young children need to do estate planning. So do people who have children from previous marriages.
Single adults—young or old—need to plan as well.
Estate planning is not just for “wealthy” people—whatever that word means. Good estate planning is important for everyone.