When Should You Start Estate Planning? Here’s What Experts Say
Estate planning is an essential part of the financial planning process. It ensures your assets will go to the right people when you die. While thinking about who you will leave your belongings to is uncomfortable for many, estate planning is a smart thing to do.
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Anyone who owns a home or has a bank account, a safe deposit box, expensive jewelry, collectible artwork or anything else they consider of value should protect their assets. Here’s how and when they should start.
When To Start Estate Planning
Throughout life, you will experience different chapters and reach new milestones. According to experts at Trust & Will, those are the times to start planning and make updates. Here are some things you should cover in your estate planning and when, according to Trust & Will.
Savings account. From the moment you set up your first savings account, you should determine who your money will go to in the event of death.
Home and property. Upon buying your first home or property, start your estate planning to ensure your home won’t go into probate.
Marriage. Whether you’re combining assets or keeping them separate, your estate plan should indicate what happens in the event of one spouse dying, or both.
Children. A growing family is always a good time to update your estate plan.
Inheritance. It should be made clear in your estate planning where your inheritance should go in the event of death.
Divorce. Your estate plan should be updated immediately in the event of a divorce.
Grandchildren. Update your plan with any new family members you’d like to distribute your assets to.
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If You’re an Adult, You Should Have a Will
Only 32% of adults have a will, according to a recent survey from Caring.com. That can complicate matters for family members. Per Trust & Will, “The best time to make a will is essentially as soon as you become a legal adult or reach any of the above estate planning triggers.”
Not Everyone Needs a Trust
If you have a lot of assets, like properties, you should create a trust, according to Trust & Will. “Trusts give you more control over where your assets will be distributed while you’re still living and after death, and can help you avoid probate. Additionally, creating a trust can help you avoid additional taxes or fees as your assets pass to various beneficiaries,” the company stated.
Always Update Your Estate Plan
Life changes, and so should your estate plan. “A good rule of thumb is to revisit and update your estate plan every three to five years,” per Trust & Will.
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