Generally speaking, older people have a greater number of assets that they’ll likely want to transfer to their children or a favorite charity. They may also want to ensure that their grandchildren have the resources needed to go to college, start a business or buy land. Fortunately, there are many tools that you can use to ensure that your estate plan meets your needs.
Choosing between a will and trust
A will or trust will be the foundational document of most estate plans. It will determine where assets go after you pass away, and if you have custody of a grandchild, these documents can also be used to name a guardian for that individual. The key difference between a will and a trust is that the trust takes effect right away. Furthermore, you can retain assets in a trust after you die, which can be ideal if your beneficiaries are minors who can’t own property in their own name.
Trusts can be revocable or irrevocable
A revocable trust may be ideal for those who want to retain control of assets such as a house or bank account during their lifetimes. An irrevocable trust may be ideal for those who want to make gifts while they are still alive. Making gifts offers individuals the ability to reduce the value of their estates while also seeing the impact that their generosity has made on others.
Other documents to consider
Older individuals may want to consider adding an advance medical directive as well as a financial agent to their estate plans. This may make it easier to communicate with doctors, pay bills or take care of other tasks while incapacitated. These estate planning documents can be crucial.
Having an estate plan may make it easier for loved ones to ensure that your final wishes are carried out. It may also make it easier to manage your affairs in the event that you become incapacitated or simply want someone else to do so on your behalf.