Most adults have probably heard that they need to have an estate plan in place, but some may not realize the importance of it. While you may have seen one-size-fits-all estate plan programs online, those are typically a good idea for most adults.
Your estate plan must be tailored to fit your needs and wishes, as well as your loved one’s circumstances. Understanding a bit about an estate plan may be beneficial.
What goes into an estate plan?
The estate plan is a set of documents that outlines your wishes for your assets once you pass away. It also includes certain aspects of your final wishes, such as who you want to make medical or financial decisions for you if you become incapacitated.
The will is the backbone of the estate plan, but that’s not the only component to consider. Another thing to consider is trusts, which allow you to pass down assets to your beneficiaries under the terms that you set. Medical directives and power of attorney designations are also components that you should consider.
What happens if you don’t have an estate plan?
Michiganders who don’t have an estate plan won’t have a say in what happens if they become incapacitated or what happens with their assets after they die. The state has intestate laws that govern who will receive what. This is based on marital status and familial relationship. For example, spouses don’t automatically inherit everything outright if the person who died has children.
It’s critical to consider every component of your estate plan before you get it all set. Even after you set it, you can’t just forget about it. Instead, you should review it if you have major life changes or if you haven’t checked it out in a few years. Working with someone familiar with these matters may be beneficial.