People often think that estate planning is for the wealthy, but everyone should work through the legal plans for their estate. Often, the less wealth you have, the more critical it is to ensure that the value of your estate goes to family or friends rather than being consumed by legal fees. Estate planning simply outlines a strategy for who gets what upon your death, an event that ultimately claims all of us.
Estate planning can be as simple as preparing a will designating the distribution of your assets. Of course, the process can become much more involved depending on the size and types of assets you own. The tax consequences of various asset types differ substantially. Proper estate planning may include gifting or selling specific assets during your lifetime or designating that particular assets are gifted to the nonprofit organization of your choice.
Besides the financial side of estate planning, the process can also include advanced care directives, such as who has the power to make medical or financial decisions on your behalf if you become incapacitated. You also have the right to determine the types of medical care provided at later stages of life and what happens to your body when you pass. All or some of these decisions can be considered a part of estate planning.
