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3 questions to ask when estate planning

On Behalf of | Jan 4, 2024 | Estate Planning |

Estate planning is the process of instructing how your assets should be handled in anticipation of your passing. Your estate plan may be a proactive attempt at making it easier for your family and friends to settle your estate. 

Estate planning is a complicated process. It may help to ask these questions before you begin your first draft:

1. What is an heir and beneficiary? 

While heir and beneficiary are terms that are often used interchangeably to mean someone who will benefit from your estate, they don’t mean the same thing. An heir is someone who would have a legal claim over your assets if you passed away without a valid will. These people may not be your first pick in your estate plan.

Your beneficiaries are people who you want to gain from your estate. For example, you may wish for your child to gain from your estate before your spouse. You could also name friends and colleagues as beneficiaries. 

2. Who is your executor of the estate?

Someone needs to distribute and settle your estate. That someone is your executor of the estate. Your executor can be anyone of legal age, but it may also be someone whom you can trust.

Your executor does more than distribute assets. They may also be responsible for settling debts and taxes, contacting your bank, locating beneficiaries and protecting your assets.

3. Is a will enough for your estate?

While your will is the most basic legal document in your estate plan, sometimes it isn’t enough. Wills can face estate taxes, probate and disputes. You may opt to include a trust in your estate plan. A trust is a legal document that can avoid estate taxes, probate and disputes by having a trustee hold assets for beneficiaries. 

When you’re making your estate plan, legal guidance can help ensure that nothing is overlooked.