Estate planning can be rough if you don’t know what you’re doing. Essentially, you need to make sure that the belongings and valuables that you bequeath will be legally passed on to the right people. There are certain legal steps you should take to ensure that.
Add Children as Beneficiaries
Making sure to put down your children on a legally binding last will and testament is of the utmost importance. Don’t procrastinate getting together with your lawyer and figuring it out. Naming your children specifically will make it harder for there to be mistakes, mix-ups, or interference from outside influences. The sooner you take care of it and have them named, the sooner you can stop worrying about life-altering emergencies. If something were to happen, and you weren’t prepared, your assets might go to probate.
Put Them in a Trust
A trust is another great way to avoid legal issues if a sudden death were to occur. A trust is basically a third-party legal entity that will keep and bequeath assets to those who have been contractually named beforehand in the manner that was contractually listed. This allows for some interesting flexibility while still keeping significant legal protection – for example, doling out a specific percentage of an inheritance on a yearly basis over the course of a decade. Trusts can also help you avoid issues with debt collectors or other people who have some legal claim to your assets. When assets are passed through a trust, there’s no need to file for probate at all.
Update Your Estate Frequently
Whether you use a trust, a will, or another way to pass on your assets to your children, you will need to update it frequently. The birth of another child, a divorce, a remarriage, an adoption, or simply changing your mind about something are all great reasons to update your estate. If you don’t, if you forget to go through with it, and then you were to pass away suddenly and tragically – that might create serious problems. Every six months or every year you should reconsider your assets and your loved ones to make sure that everything is in order.
The danger is that your assets could end up being contested in probate court. There’s no guarantee that your loved ones would get your assets back – or that the right assets would go to the right people. Put in the effort now in order to create a more secure future for them.
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