Most people are not comfortable thinking about their own mortality. However, all of us die. It is a more certain fact of life than the belief that a politician will tell you exactly what he thinks you want to hear, regardless of the truth.
Those who are too uncomfortable facing death run a scary risk. A person who dies without a will is said to, “die intestate.” The courts will determine how your earthly possessions are distributed and to whom.
The courts will try to anticipate your desires but without guidance from you it can only guess. The court may, or may not, give your things to the people you want to have them.
In order to avoid the hassle and expense of the court having to determine how your assets are distributed, you should consider doing some estate planning.
SIMPLE ESTATE PLAN
Estate planning does not have to be complicated. Many Americans can get by with a very simple will that you can do on-line for your accumulated assets. A term life insurance policy can be used to create assets when you die.
This simple strategy is fairly easy and inexpensive. It is a fine option for young singles and newly weds without children.
BASIC ESTATE PLAN
Americans who have younger children probably need a little more guidance. Their estate planning team should include an attorney and insurance agent.
The attorney should understand the estate laws in their state. If they have a preference over who would raise their children if they are not around to do it, a formal will gives the court guidance when it determines who your child’s guardian will be.
Your attorney can help you compose your will but you will need a life insurance agent to help you give enough money to your child’s god-parents if both of you die before your child is grown.
Don’t forget that it will cost your child’s guardian to raise your child. According to the latest numbers I have read, it costs close to $250,000 to raise a child to age 18. Term life insurance is typically very inexpensive.
ADVANCED ESTATE PLAN
If you have been fortunate enough to accumulate a sizable amount of assets, have ownership in a business or have children from multiple marriages, simple and basic estate planning strategies are not enough. You need a more specialized planning team
Any old “country lawyer” and insurance agent will not do. You should form a team that includes an attorney who specializes in Estate Law and an insurance agent who is trained in working with estate planning. Depending on the size of your accumulated assets, you may also want to add a C.P.A. to the team.
You may have to spend a few thousands of dollars to have your attorney draw up the trust documents you need. However, by spending a few thousand dollars while you are alive, you will save your loved ones tens of thousands of dollars when the time comes to distribute your estate.