The purpose of estate planning is to help you manage your assets over time, and control how they are distributed and cared for after your death. “Estate planning” is a broad term that can mean different things to different people, depending on your stage of life, your wealth, and current lifestyle, among other factors. For example, a wealthy person with valuable antique furniture or jewelry pieces but no descendants to pass them down to will have different desires than someone with a healthy savings account, but no beneficiary.
In many ways, estate plans overlap with life insurance plans, which also deal with distribution of funds after a person dies. Read on to learn more about the similarities and differences between these policies, and what they can look like for different types of people.
Estate Planning for Different Life Phases
Many people are under the impression that having a will takes care of estate planning. Still others think that the only people who need a will or an estate plan are those old enough to retire. Unfortunately, these misconceptions can cause unnecessary stress for those left behind after a loved one passes, regardless of their age.
Truth be told, people of all ages can benefit from estate planning. These plans can be as unique as the person making them, but everyone could use one, nonetheless. Understanding what to include in these plans depends on your specific goals and needs regarding your finances. Even if you don’t think you have anything of much value, deciding what to do with your possessions and savings can be a headache for your relatives.
Here are some examples of what an estate plan can look like for different life stages:
During and After College
As a college or graduate student, you already have a lot on your plate. Still, these are some basic documents that can be useful in the event of a healthcare emergency or other worst-case scenario:
- Power of attorney. And Health care surrogate This is an unpleasant situation to think about, but if you were incapacitated after an accident, how long would you want to be on life support? Who can make decisions about your care if you’re unable to do that for yourself? Choose a person you trust, such as a parent or a close friend.
- Your beneficiaries after your death. If you have a savings or checking account, that money must go somewhere. Maybe you don’t have children yet, but you can request that your money go to another relative, a close friend, or a charity of your choice. Do you want the rest of your possessions donated or sold? Who takes care of your pet? These are all important things to consider when making your plan.
Marriage or Serious Partnerships
Estate plans and life insurance policies can cover the salary and enable the surviving spouse to stay in the home you shared together. This will prevent the need to adjust one’s cost of living, on top of dealing with funeral arrangements and grief. Estate plans can prevent conflict for couples who share property and possessions but have different last names.
Starting A Family
As a new parent, you want to secure the best possible future for your new baby. That could mean setting aside some money for him or her to use for college tuition, a wedding, or an apartment. Life insurance and estate plans can give your child a secure cushion if anything were to happen to the parents: an uncomfortable but necessary prospect to consider.
Estate Planning and More in South Florida
Many people use life insurance policies in their estate plans. Having these policies in place will make things much smoother for your relatives to navigate in the event of an untimely accident or death. For help setting up your own plan, the experienced attorney at Handin Law can walk through the process with you. Call us today for a consultation at 954-796-9600.