While estate planning can seem like an incredibly complicated and difficult subject, it’s easier to understand it if you keep a few simple rules in mind. When you create an estate plan you won’t be required to have a vast and comprehensive understanding of the field. All you have to do is leave it up to your attorney to explain what options are available to you, and do so in a way that allows you to make the best decisions possible. To help keep you focused on creating the best plan you can, you should try to keep the following five rules in mind.
Estate Planning Rule 1. Focus on simple goals.
The most effective estate plans are those that you can understand and use effectively. If you are just getting started, trying to create a plan that is too complicated might be counterproductive. A simple plan is often an effective plan because you can use and understand it easily.
Estate Planning Rule 2. Be ready to change.
There is no such thing as a “perfect” estate plan. Instead, there are plans that fit your current needs, choices, and desires. However, the choices you make now may not be best for you in the future. Whether the law changes, your needs change, or you simply have a change of heart, you need to be ready to update and modify your plan when necessary.
Estate Planning Rule 3. Have a good understanding of your financial situation.
Many of the issues you will face while you create an estate plan revolve around future finances. This will require you to have a good understanding of what your current financial situation is. If you haven’t already done so, developing a net worth statement, inventory of assets, or even a simple list of assets and debts can be a great help.
Estate Planning Rule 4. Make your wishes known.
When you make decisions about the inheritances you want to leave behind, the kinds of medical choices you might want made on your behalf, or other essential estate planning topics, letting your close family members and loved ones know what your decisions are is often very important. Estate planning conflicts can easily arise because people fail to announce their wishes to those who are closest to them. You can easily avoid this possibly with good communication.
Estate Planning Rule 5. Start immediately.
There is no better time to start estate planning then today. If you have yet to create an estate plan, starting as soon as possible will always be better than waiting until tomorrow. Procrastinating and delaying the process is a problem waiting to happen.