What is an Estate?
What is It? Your estate consists of everything you own after you die. Yes, everything. This includes tangible things like your vehicles (cars, motorcycles, boats), the cash under your mattress, and real estate (your house, rental property, etc.). This also includes more unique or rare tangible items such as antiques, firearms, designer handbags, jewelry, and stamp collections. Intangible things like bank accounts, investment accounts (retirement accounts, brokerage accounts), cryptocurrency, ownership interests in businesses and insurance policies are also included in your estate. Some uncommon intangible items that could be part of your estate are patents, trademarks, and royalties. If you can own it, it’s probably part of your estate.
How do I protect my estate? To get started, create a record of what you own - a handwritten list is fine at first. Usually, estates are divided among the members of a deceased person’s family, and this passage of wealth from one generation of a family to the next is a significant contributor to total wealth. To protect your estate and make sure that it is distributed in accordance with your wishes, you then need to create an estate plan. Your particular estate plan will vary depending on a multitude of factors but a typical estate plan will consist of a revocable living trust, will, power of attorney, and advance medical directive. Non-typical but still fairly common components include the use of irrevocable trusts and gifting strategies.
What professional(s) should I hire? To create an enforceable estate plan, minimize the taxes taken from your heirs, and avoid probate pitfalls, you probably want to employ the services of a qualified estate planning attorney in your area. But there is no one size fits all approach to estate planning. Everyone’s circumstances and goals are slightly different. Some of those differences could have a huge impact on your estate plan. Although some young adults with no children and few assets may be able to get away with DIY options, that may not be applicable to your situation.