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Most human beings are procrastinators by nature. After all, why do today what we can put off until tomorrow? And the farther out something appears, the easier it is for us to hold off on dealing with it. This is especially true for something like creating our will and planning our estate, which makes us think of things we’d rather ignore.
It’s easy to just say that you are too young for a will, but age has little to do with it. Estate planning is something that should be a priority for anyone who has gotten married or had children or grandchildren, because it is likely that you want these people mentioned in your plans.
How can you begin to plan your estate?
Choose decision makers. No one wants to think about this, but in the event that you can no longer rationally handle your affairs, you need to give someone power of attorney to do so. There are two different types of power of attorney: healthcare and financial. A healthcare power of attorney is able to make decisions about the level of care you should receive if you can’t make those decisions yourself. Things like whether or not you want to be kept on life support. A financial power of attorney gives someone the authority to handle your money matters if you can’t deal with them any longer.
Talk to a professional. It’s not required, but many people hire attorneys with experience in estate planning to help them with their affairs. The great thing about people with this kind of specific knowledge is that they can take you down a list of things that you should consider and help you answer those questions you didn’t even realize you had.
Consider people as guardians. If you have children, you want to make sure that they are taken care of just in case something happens to you. Think about who you would want to raise them, and appoint these people as official guardians in your will. It may be wise to come up with a few alternates just in case your first choice is unable to do it.
Designate a trustworthy executor. Someone has to handle collecting all of your assets (including contacting banks, insurance companies, filing taxes, and so on), dealing with your attorney, and reading the will. The executor is this person, and they should be someone you believe you can trust and will be able to handle all of the responsibility.
Make a list and keep it updated. Estate planning requires you to be very specific, especially when considering where your money and other assets are going. Make a list not only of friends and relatives that you want recognized in your will, but also any organizations and charities. Clearly define (in actual numbers, items, or percentages) what you would like them to receive.
Beat the tax man. At least until 2013, couples can give away up to $10 million as a gift without paying the normal estate taxes on it. Talk to a professional to learn how.