Estate Planning

The process of determining how a person’s assets will be distributed and disposed after his death is called estate planning. When conducting estate planning, the person and his financial advisors will focus on a number of factors.

The factors they will take into account include, but are not limited to: the total value of the estate, the makeup of the estate (is it real estate, stocks, bonds, etc), the number of heirs, and any charitable gifts the owner intends to make. In addition, estate planning is usually conducted in such a way as to minimize the probate court involvement, and the taxes on the estate after the owner’s death.

There are a number of tools that people can use to help with estate planning. The most obvious, of course, is the individual’s will. This is a legal document giving basic instructions to divide up estate assets. Beneficiary designations, and various forms of trusts and trusteeships are also used to distribute estate assets. Finally, the power of attorney can be used to designate a person or persons to make these decisions in the event of unforeseen circumstances.

All in all, estate planning is a complicated process, and one that even experienced financial planners are loathe to take on alone. Before making estate planning decisions, it is always best to consult with your regular attorney, and perhaps you banker or financial planner as well.