Retirement & Estate Planning

The Benefits of Estate Planning: What, Why, and When

The Benefits of Estate Planning: What, Why, and When

When you hear the word “estate,” what comes to mind? Maybe you imagine a large gated mansion with a manicured lawn, carriage house, and vineyard. Think again. An estate is everything you own, from your vehicle and your home to your bank accounts and life insurance. Everyone has an estate—rich or poor. However, many Americans don’t have an estate plan in place.

Estate Planning Basics

While estate planning may not be at the top of your to-do list, this task should not be put off or ignored. An estate plan allows you to determine the distribution of your belongings and property once you’re gone. If you don’t have this in place at the time of your death, the state makes those decisions through a complicated and lengthy legal process. Estate planning also helps protect you and your assets should you become unable to make legal decisions regarding your finances, your property, or your health.

There are four main components of estate planning to consider.
• Wills – In its most basic definition, a will is a legal document that defines who will receive your property, manage finances, and care for your children.
• Trusts – More complex than a will, a trust specifies how and when the money you leave someone can be used.
• Durable Power of Attorney – Designates who can make legal and financial decisions for you if you are unable to do so.
• Health Care Directive – A type of Power of Attorney specifically for health care decisions.
• Living Will – This statement details your wishes regarding medical treatment and artificial life support.

No matter your stage in life, estate planning is an important part of your family’s financial health. While the task may seem daunting at first, in the long run, having an estate plan in place will lessen your anxiety and that of your family members. Estate plans should be reviewed periodically throughout your life, especially at key life events, such as marriage or divorce, the birth of a child, significant income changes, and retirement.

We recommend working with a financial or tax professional or estate planning attorney to begin the process and put these necessary safeguards in place. In the meantime, visit The Bank of Elk River’s consumer resources to learn more about the different components of estate planning. Contact us for additional information.

Find peace of mind with an estate plan.

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Estate Planning Benefits of Estate Planning Living Will Health Care Directive Power of Attorney Trusts Wills

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Retirement & Estate Planning