Estate planning in Indiana is often juxtaposed against other terms, such as wills or trusts. But what do these words mean? Are they all the same things, pieces of a whole, or alternatives? CNN Money describes estate planning as the planning process behind how assets will be distributed after someone passes away.
Many people believe estate planning is only for the wealthy, but everyone should try to have a plan in place, regardless of their net worth. By working with financial planners and other professionals, people help to ensure taxes take as little as possible from what they leave to individual beneficiaries. Here are some of the aspects of estate planning worth looking into:
- A will that details how assets should be distributed
- A living will that details what kind of life-sustaining medical procedures an individual prefers or does not prefer if they become incapacitated
- A health care proxy which authorizes a trusted individual to make medical decisions
- A trust to minimize taxes wherever possible and detail how assets should be distributed
Young people often believe estate planning is only for the elderly, but this could not be further from the truth. CNN Money says it is never too early to start estate planning. Regardless of age, the process is typically the same. Individuals first begin by taking stock of all their assets. Some of these include the following:
- Business interests
- Insurance policies
- Retirement accounts
- Valuable personal items
Another important step of estate planning is to discuss who gets what with the beneficiaries. This may help to reduce the likelihood of disputes later on. The last thing anyone may want is to leave family members with high taxes, high debts and unnecessary quarrels, so the sooner an estate plan is in place, the better.