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For some people, it can be scary to think about what will happen to their hard-earned assets if they should die or become incapacitated for any reason. To make things a bit easier, it may be a good idea to look into estate planning and how it can benefit you and your family.
A will typically addresses what should happen to your assets after your death and may also include information regarding who will assume care for your children. Estate planning involves documents that are actively in effect during your lifetime, as well as information regarding what should happen to your assets when you pass on.
Estate planning can include a living will, which documents information regarding the medical care you wish to receive if you're unable to speak for yourself. It also allows you to designate someone to have your power of attorney, who will act as your financial decision-maker if you become incapacitated.
If you have an IRA or company retirement plan, you need to take special care to avoid beneficiary designations that conflict with your overall estate plan. Many people don’t realize that the estate planning documents (wills, trusts, etc.) take a back seat to the beneficiary designations they make when establishing these accounts – often without reviewing them over the years, even though their family relationships have changed.
Most financial advisors recommend that you start estate planning as soon as you become a legal adult and that you update your information every few years. Estate planning makes it easier for your family and/or the person to whom you have granted power of attorney to uphold your wishes in the event that you are incapacitated or die. As much as we like to think we'll continue living our lives until old age, accidents and death happen to young people every day, so you want to be prepared.
An estate plan is useful if you want specific assets to be granted to certain loved ones if you were to pass away. It's also crucial for ensuring that your wishes are respected if you become incapacitated and would you like to provide specific medical instructions in case you're unable to speak for yourself.
It's best to discuss estate planning with an estate planning financial advisor. Not only can they teach you about the basics, but they can also explain what's included in estate planning and guide you through the process. Here are a few things you may want to discuss with a financial advisor:
Estate planning is important for anyone who's a legal adult because anything can happen in life and it's good to be prepared. If you have special religious beliefs or requests for medical care, it´s important for medical personnel to know these things if you become incapacitated. It's also a good idea to have plans for your assets if you die, partially because it alleviates the stress of family disputes after your passing.
It's important to start planning early, so don't navigate this difficult process alone. Work with a professional that can review your options for you. If you're someone who doesn't have an estate plan and would like to get started, reach out to speak to an estate planner at The IRA Specialists, where our advisors are professionally trained to ensure you have the estate plan you want.
The IRA Specialists and LPL Financial do not provide legal advice or services. Please consult your legal advisor regarding your specific situation.