Most people think that they have a basic understanding of what will happen to their belongings after death, but few people truly understand how important planning for end-of-life matters can be. Estate planning takes what a person might think they know, and transforms it into something that is actually applicable in real life. By utilizing a few key documents, California residents can create clear instructions for their loved ones, pass on assets and give others the ability to make important decisions on their behalf.
Most people keep their passwords stored in the safest spot they can think of -- their own minds. However, what happens to the often dozens of online accounts after that person passes away? Suddenly Facebook, Twitter, Instagram and email accounts are inaccessible, leaving families confused and overwhelmed with how to handle a loved one's internet footprint. However, digital assets consume much more than just social media. Many California residents now deal with banking and other important financial commitments exclusively online, making it important to include relevant information in wills.
A last will and testament is probably the most well-known estate planning document. People in California use this powerful tool to pass on inheritances, name guardians for minor children and outline their final wishes. However, there is one thing that many people fail to account for in their wills -- the estate tax.
Many people in California excuse their lack of a will by claiming that they do not care what happens to their possessions after they die. Although there may be some level of truth to this, most people certainly care about their loved ones and the effects of handling an estate. Here are just some of the problems that can arise when estate planning is overlooked.
Celebrity deaths tend to bring out mixed emotions in people. Some mourn the death of a beloved role model or icon, while others acknowledge a celebrity's passing without much emotion. However tragic the death of a high-profile individual might be, the celebrity's estate plan -- whether good or bad -- usually serves as an example of the importance of proper estate planning. The late Hugh Hefner is no exception.
Ask most people what an estate plan is for and you will get the same approximate answer -- it is for dividing an estate after death. However, this is just one part of estate planning, and only putting in the bare minimum with a will leaves people in California vulnerable, particularly as they near the end of their lives. Although it can be uncomfortable to discuss end-of-life wishes, health care directives can provide guidance during emotionally strenuous times.
Wills are valuable documents whether the testator intends to pass on a home, important family heirlooms or personal items of great value. While the role that a will plays in passing on physical assets is quite clear, many people in California are less certain about how their digital assets fit in. Because of licensing and terms of service, estate planning must be carefully utilized for digital property.
A proper estate plan requires the right ingredients. Attention to detail, an understanding of the importance of a will and open communication with heirs are all essential steps of creating a successful plan. Unfortunately, there is one important part of estate planning that many people in California forget about -- updating.
There are a lot of misconceptions out there when it comes to certain estate planning documents. Trusts are a great example. Many California residents may not understand how they really work; therefore, they may be afraid to use them.
After taking the time to put an estate plan in order, who really wants to think about it anymore? Most people do not. Unfortunately, it is hard to achieve asset preservation if one's estate plan is not kept up to date. California residents can help themselves by reviewing and updating their estate planning documents on a fairly regular basis.