How Your Estate Plan Will Help You Leave A Legacy
An estate plan is an essential part of your retirement planning. Thinking about this era of your life may feel far off, but planning for it now will help you feel at ease. An estate plan also lets you know that your loved ones are taken care of and that your money will support things you care about. Here we’ll explore a few critical elements of an estate plan.
What’s Included in an Estate Plan
Your estate plan names the people, organizations, and other entities you want to take ownership of your assets after you pass. This will include things such as your primary home, real estate, family businesses, personal possessions, savings accounts, investments, and insurance policies.
A thorough estate plan will ideally include a will, power of attorney, executor, a letter of intent, health care directive, beneficiaries, assigning document locations, trusts, trustees, guardians, and a living will.
You may already be familiar with wills and trusts; these are key to your estate plan. These documents ensure the property is distributed according to an individual’s wishes (if drafted according to state laws). A will must be explicitly worded to avoid confusion or misconstrued information later when it’s read and implemented. You will likely want to hire a professional, such as an attorney, to write it.
The other pieces mentioned above of a solid estate plan cover everything from who can act in your name when you can’t (power of attorney) to documents that help things be written out clearly (letter of intent).
A healthcare directive will allow you to decide if you want to be put on life support if you are in a terminal or permanently unconscious condition. Don’t forget to appoint guardians who would theoretically take care of your children should anything happen to you.
Everything about your plan should be set up so that if you are gone or incapacitated, details are laid out clearly with no room for misinterpretation, and the individuals you put in charge are those you trust implicitly.
Why You Should Have an Estate Plan
No one likes to think about their mortality, but planning is critical. Estate planning allows you to take proactive steps to help make it easier to put your mind at ease now and allow your loved ones to fulfill your wishes after you’re gone.
If you have an estate plan, there’s a guarantee that your assets and wishes will be carried out as you want. Without a will, your estate will end up in probate court, and the courts will decide who will inherit your possessions and assets.
You can see why it’s better to plan now to make such personal decisions and, as best as possible, avoid contention or confusion for your family in the future.
What does Legacy Mean to you?
In addition to the benefits already mentioned, it’s important to note that leaving an estate plan can help you leave a legacy. Your idea of leaving a legacy, or having a positive impact on the world, will be unique to you.
One question you can ask yourself to determine your values is, “how do you want to change, preserve, impact, cure, and enhance the world?”
For example, an athlete could sponsor a new athletic program for their local school, an author may want to have their novel become a bestseller, or an educator could have a scholarship in their name for students in their field. The options are limitless!
It’s a good idea to involve your spouse and other family members in decisions regarding your estate plan. Ensuring everyone is on the same page regarding the “why” and “where” your assets will be used can help maintain clarity for the future and strengthen your family bonds.
In addition, by talking to everyone involved, you can brainstorm more ideas and view your legacy in potentially new and exciting ways!
Defining Your Legacy
We realize that leaving a legacy can seem daunting, so when figuring it out, take your time!
Here are a few more questions to ask yourself to hone in on what you value and what your money can do to express those values:
- Of all the gifts you’ve given to charity, which has meant the most to you?
- Is there something that your entire family is passionate about? Health, animals, food security, etc.
- What values drive and define your life? Are you driven, compassionate, and confident?
- What are the critical relationships in your life? Do you have children, aging parents, or other loved ones that depend on you? How will you continue to take care of them through your legacy?
- Will you leave things to your family? Charity? A specific cause?
Your money is much more than a number and can make a difference. This can be empowering, so enjoy finding ways to give back and make your money go the distance after you’re gone.
Start Planning Today
Your financial planner knows how to help you navigate the personal as well as financial aspects of an estate plan. They can help you navigate your values and goals to decide precisely how they fit into your legacy plan. Please contact us today if you’re ready to leave your legacy through your estate plan.