Time is ticking away and we are all heading to that fateful day when we will no longer be among those on this earth.? Sounds morbid, huh?? You may not think about this too much, or you may think about it a lot; It probably depends on what phase you are at in life.? If you are young, it may not cross your mind too much.? Since it is part of my our work, we think about it during the process of helping others think it through.? I (Mark) also think about it because I have reached the point of realization that life is flying and we should all make the most of it.
What is an ?estate??? It is defined as property or possessions.? In other words, all your stuff.? As the saying goes, ?You can?t take it with you.?? Estate planning is the process of determining where you want all your stuff to go when you die.? Estate planning allows you to exercise some control over where things go and how they get there.
During the course of our lives, we have the tendency to accumulate a lot of stuff ? things like houses, cars, money and tangible personal property.? Some of these assets may be of great monetary value while others may be of great sentimental value. Things we are sentimentally attached to are usually those that trigger good memories from the past or are things that have given us joy.? I am amazed at the amount of stuff I have accumulated over the years and yet, most of these things I probably would not miss if they were gone.? There are a few things like my bible, my wedding ring, my class ring, photos and several guitars that are very important to me.?? These are things that I would want to make sure ended up in the hands of the people that I love.
How should you plan getting your stuff where you want it to go?? There are several things that are important to know:
1. Everyone should have some type of legal document that directs where the assets of their estate should go when they die.? This document is most commonly referred to as a last will and testament.? Your will not only says who gets what, but it also says who will direct the process on your behalf (commonly know as your executor or personal representative).? Also, another popular legal document that may be used in the place of a will is a living trust.
2. A last will and testament does not necessarily control where everything goes.? Certain assets such as retirement accounts, annuities, life insurance, etc., are controlled by beneficiary designations.? Make sure that these designations are up to date and reflect your current wishes as to where these funds will go.
3. If you wish that certain sentimental items go to specific individuals, make sure that you designate these as specific gifts in your will.? Otherwise, these items may or may not get to the person that you wish to have them.
4. If you have minor children, make sure you have named guardians to take care of them should you die prematurely.? Think through issues like whether these potential guardians have the financial means, do they share your views on how children should be raised, do they share your religious views, where are they located, etc.
5. Make sure you have enough life insurance.? Life insurance is a powerful tool in estate planning.? It can be used to provide liquid funds to replace lost income, pay off a mortgage, pay for a college education, pay debts, pay taxes or just provide a better life to the beneficiaries.? Or you may just want to leave more money to those that you love.? Current assets can be used to pay for insurance that will create large dollar amounts later.? The Retirement Guys call it leveraging.
6. Make sure you have a durable power of attorney and health care directives in place.? These documents allow someone to manage your assets and your care should you reach a point that you are unable to.
These are some of the important things to consider when planning for where you want your stuff to go when you die.? Each person?s situation can be somewhat unique and there are other issues that may need to be considered.? Be smart and seek out a qualified professional to consult with about creating your estate plan.? Your loved ones will someday be glad you did.
For more information about The Retirement Guys, tune in every Saturday at 1 p.m. on 1370 WSPD or visit www.retirementguysnetwork.com.? Securities and Investment Advisory Services are offered through NEXT Financial Group Inc., Member FINRA / SIPC.? NEXT Financial Group, Inc. does not provide tax or legal advice.? The Retirement Guys are not an affiliate of NEXT Financial Group. The office is at 1700 Woodlands Drive, Suite 100, Maumee, OH 43537. (419) 842-0550
Tags: Retirement Guys
Source: http://www.toledofreepress.com/2012/10/20/retirement-guys-what-is-estate-planning/
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