Creating an estate plan is only the beginning of establishing protections for your property and your loved ones. Over time, changes in your circumstances, e.g., the addition or loss of family members and other beneficiaries, along with any changes in tax laws may affect the provisions of your estate plan. To make sure that your beneficiaries receive your estate precisely as you intend, it is essential to review your estate plan regularly to account for these changes.
Many people understand that having a good estate plan is key as they age. If you're ready to create an estate plan, there are many factors to consider. Here are five things to remember when you create your estate plan.
Have you finally decided to hang up your work boots once and for all? If so, you know that your life is going to change in many ways. In particular, your financial situation will never be the same.
A will is one of the most foundational documents in the estate planning process. A will is a legal document in which a person designates who will receive one's property when he or she dies.
Careful planning when one is of sound mind and body can help to ensure that one's desires and intentions are properly carried out upon one's death. Organization of one's finances and assets ahead of time also benefits a person who becomes mentally or physically incapacitated and no longer able to govern his or her own estate. A professor of finance from a university outside of Massachusetts published a recent article about the benefits of taking a financial inventory for the purpose of future estate administration.
An estate plan is designed to take care of the family members left behind after a Massachusetts resident passes away. Ordinarily, the documents are set up to make estate administration easier and less time-consuming for his or her loved ones. However, dealing with the particulars of how everything will happen is too much for some loved ones. In that case, it will not matter how well an estate plan is crafted.
Most Massachusetts parents want to ensure that their children are cared for after they are gone. The question is how to divide their assets among the children in a way that will give each of them the most benefit. Every child is different, and simply dividing the assets up equally may not be the best solution.
Massachusetts residents may not realize that it is not only the wealthy who benefit from the use of trusts. In reality, anyone can benefit from using a trust as part of a comprehensive estate plan. One group of people who could benefit from the use of a trust, such as a revocable trust, are single parents.
Trusts are created to hold property and provide for beneficiaries in accordance with the terms set forth therein. Massachusetts residents who choose to use trusts do so for many reasons such as avoiding probate, estate taxes or the reach of creditors. If estate taxes and creditors are not a primary issue, then using a revocable trust or irrevocable trust can help avoid probate.
Without an up-to-date estate plan, there is little to no guarantee that a Massachusetts resident's assets will end up with the person or persons intended. This will also make the probate process more difficult for family members, since they have no guide as to how an individual wanted his or her property distributed after death. There could also be additional time and costs expended in order to settle the estate.