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Some people feel that it is not necessary to do estate planning, because either they do not have much in the way of money or belongings, or they do not have children. This assumption is not correct. If someone owns anything that they would like someone else to have after their passing, they need to plan ahead by drafting and filing a will, as well as establishing a trust.

Filing a will is usually the first step of estate planning. This is a legal document that indicates how a person wants their belongings to be divided after their death. Most people have an attorney draw up the document, though some choose to do it themselves. Once the will is complete, it is filed with the court and becomes a legally binding document.

Establishing a trust is something that more and more people are beginning to do in order to place certain restrictions on their assets, save their heirs from the obligation of gift and inheritance taxes, or to help settle the division of property more quickly upon their death. Individuals with any amount of property can benefit from having a plan of action pertaining to their belongings.

There are two different kinds of trusts, revocable means that the person can still have access to all of the assets of the trust, where irrevocable means that the assets are no longer available for use by the person who established the trust. When establishing this, most people will go to an attorney who specializes the field because if anything is set up incorrectly, it can render the entire document invalid.

Estate planning is a fundamental part of life planning and requires executing legal documents to ensure beneficiaries receive intended inheritance gifts in the event of death. While few people jump for joy at the idea of planning their estate, it is important to at least implement basic elements to protect loved ones.

Minimum estate planning should consist of a last will and testament, durable power of attorney, and healthcare proxy. Individuals whose estates are valued higher than $100,000 might consider transferring inheritance assets into a trust.

Executing a last will is a simple process that does not require a lot of time. A will provides details of how assets should be distributed. Upon death, the will is submitted through probate court and becomes a matter of public record. Probate can be prolonged when individuals die intestate (without a will) and assets are distributed according to state probate laws.

Executing a will is particularly important for individuals with minor children. Wills include guardianship provisions to protect children if one or both parents die. If no will exists, the children’s fate will be determined by a probate judge.

Estate planning lawyers can help establish a final will or trust. Depending on the complexity of your estate, the cost to execute a legal will can range from less than $100 to more than $1000. Trusts require additional paperwork and time. Assets placed in trusts are usually exempt from inheritance taxes.

In order to draft a will, you will need to write out a list of personal property, real estate holdings, financial investments, life insurance policies, and business interests. Next, you need to determine who will receive each asset in the event of death.