An estate plan simply spells out what will happen to your assets after you die, or in the event you become incapacitated.
Most estate plans are made up of three parts: a will, a power of attorney, and medical power of attorney. This means you’ll need to ask yourself some tough questions, such as: “who do I want making medical decisions for me if I become incapacitated? Who do I want to look over my financial affairs? Who do I want to inherit my assets?” Your documentation must follow federal and state laws, so you may want to seek the guidance of an attorney.
Most important, you’ll need to know what you’re leaving behind, so take a look at all your assets, including real estate, investments, savings, business interests and insurance policies. Distribution of these assets can have tax implications for your family, so meeting with a financial planner can help make sure your loved ones get the most of your estate.
Having an estate plan can ensure your family will be cared for after you’re gone.