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The Importance of Estate Planning

by Jared Newnam
November 30, 2012 South Source learns about the importance of estate planning.

No one wants to think about depressing topics like who you want to serve as your executor of estate if something tragic were to happen, but by taking care of this information in advance, you can help to make things a bit easier for your grieving loved ones.

Everyone needs a will, according to Legacy Connect. The site states that there are many different aspects to estate planning, including choosing the person you’d like to handle your affairs if you become incapacitated while still living, and deciding who you would like to leave your assets to upon your death.

According to Legacy Connect the general benefits of having a will include:

  • Having the ability to decide who will receive your assets following your death. If you have children, this also includes deciding who will have custody of them if something were to happen to you.
  • Selecting the person who will serve as your executor of estate.
  • Saving your loved ones probate costs.
  • Having the peace of mind that comes with knowing that your affairs are in order and your loved ones won’t have to sort them out upon your death.

Choosing an executor of estate is a big responsibility and shouldn’t be taken lightly. An article in the New York Times recommends selecting a well-organized person who you feel will be able to meet any necessary deadlines, in addition to of course being a very honest person.

The article also states that many people choose to name all their children as executor of estate, so as not to offend anyone, but says that is a bad idea. It can be a hassle to divide the work equally and get all required signatures on documents, so the article advises selecting only one person, and name any others as alternates.

Creating an Online Will

While necessary to have, a will can be a very costly document to create. That’s why companies like LegalZoom and Rocket Lawyer offer services where consumers can make an online will for a fraction of the cost.

According to an article in U.S. News & World Report, the average estate plan costs between $500 and $1,000 if prepared by an attorney, while LegalZoom documents can be created starting at $69. The article states that people with assets worth more than $2 million should avoid creating an online will due to estate taxes, but for those worth less, it could be a useful option.

Understanding Estate Planning Documents

A number of different documents are involved in estate planning. Choosing which ones you need can be confusing, so it’s important to gain an understanding of the differences, so your estate planning work is completed properly.

LegalZoom explains the differences between a last will, living trust, and a living will as follows:

Last Will

  • Specify distribution of assets.
  • Designate legal guardian for minor children.
  • Give last wishes, including funeral and burial requests.

Living Trust

  • Document helps to evade costs and delays of probate.
  • Allows you to keep your estate information private.
  • Can help to decrease some estate taxes.

Living Will

  • Allows you to decide your preferences for life support in advance.
  • Gives you the chance to specify organ donation wishes.

Tags: living will living trust estate planning online will executor of estate

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