Approaching estate planning can be daunting as it involves thinking about one’s life and death. For most New Jersey adults, though, the process can be broken down into a few straightforward steps. Some of the most important things are to establish guardianship, evaluate assets, choose an executor for your will, and name beneficiaries.
Establishing guardianship through an estate plan
One of the life events that has a major impact on estate planning is having children. This will often cause parents to purchase life insurance, for example, and draft a will if they don’t already have one. It is also important to establish through estate planning who will take care of your kids if you die. Many new parents will list their own parents as the people to raise their kids if something happens to them. That is a planning provision that will need updating later when the people involved are older.
Evaluating assets for estate planning
One of the first steps in estate planning is to make an inventory of your assets. The most important things to note are real estate, cash, vehicles, art, retirement accounts and other assets that will be passed to heirs or beneficiaries. Once the major assets are accounted for, you can decide how they’ll be distributed and to whom. Different estate planning instruments may be used, like wills and trusts.
Shared ownership and choosing an executor
Proper estate planning can allow for many kinds of assets to transfer outside of probate. Bank accounts and real estate can pass outside of probate via shared ownership structures. For married couples, this could mean making sure that both spouses share ownership. The executor is the person charged with distributing assets by the terms of the will and carrying out the other wishes of the testator. The executor of the will is named in the will itself. Paying attention to each of these steps can simplify the estate planning process.