7 Key things everyone should know before drawing up an estate plan

Estate planning is highly underestimated and ignored by many. If you think a bit differently, then the picture will be more clear. Estate planning deals with things that sum up everything, including your career, job, business, wealth, relations, obligations, preferences, medical needs, and the list can go on. Every moment of life you spend to build a career, every dollar you earn, and every decision you make ends up in an estate plan. The wealth remaining after death will go as debts, expenses, taxes, charity, and inheritance. If someone left substantial wealth, his inheritance would be much bigger than even what he spends in his entire life. Also, the inheritance would be higher for most families because it will include anything remaining that is not just limited to capital properties and money.
Estate planning is not just about wealth, it coherently relates to your values, beliefs, and wishes are all reflected in an estate plan. Relations that make the thriving family (Spouse, children, parents, siblings, etc.) are important ingredients in estate planning. A bad relationship ends up in court, which is one of the most unfortunate situations someone may face. Wealth is material but closely connected to every heart. Wealth can tear apart years of good relationships in seconds. So, to summarize, estate planning is much more than you think.
While thinking about an estate plan, there are common challenges one may face. Many leave estate planning goals aside or keep them as a last priority. And many are hesitant to seek guidance because of challenges. Putting together your estate plan will require some thought. There are several common concerns, including choices to make your family happy, estate plan selection, tax implications, who's best to take over your business, who will be your trustees, and so on. Following are the "7 Key things" of estate planning to make your estate planning journey successful.

#1 Recognize that no family is normal
Many people do not go to an estate planner or ignore creating an estate plan because they do not want to discuss the family’s black sheep or other problems. They are hesitant about revealing personal issues with external people. Others cannot think of a solution independently, so they don’t devise any estate plan. Discussing wealth and estates will not be easy, but it has to happen sooner than later. To circumvent this situation, the family members should meet separately with the estate planner in the early stage of planning to get an idea of drawing an estate plan. Then meet with family members to listen to their opinions. Some family members might be willing to express views and thoughts separately but not with an expert. This way, communication with family members can be smooth and effective. Recognizing that conflicts may happen in every family, and whatever the family situation one may face, it’s essential that discussing now and drawing a mitigation plan would be much easier and cheaper than letting it end up in court after death. Estate plans become useless if they are created and hidden from family members because one or more members are unhappy.

#2 Learning Estate planning terms
It’s a fact that the term “estate planning” is not known to many people. When we refer to term “estate planning,” people reply by saying, “Did you say real estate?” So, it is observed that that there is a big confusion out there. Estate planning has some things in common with real estate, but it’s not the same. Estate planning is about securing your values, beliefs, wishes, preferences, assets, and inheritance. Estate plans include Wills, Trusts, Power of Attorney, Living Wills, Deeds of Gifts, etc. Wills and trusts are related to estates, wealth, property, money, vehicles, and belongings. Power of Attorney is about appointing an attorney to look after affairs, property, and other day-to-day medical needs but not medical treatments. On the other hand, Living Will is about appointing an agent to look after medical-related treatments, organ donations, and organ transplantation preferences. If you do not draw your estate plan, someone in the future will follow it according to their wishes and preferences, and you will not have any say in the decision-making process.

#3 Creating estate plans
Many options are available due to technological advancement for creating and completing your estate plans. If you have substantial assets, you should consider drawing an estate plan by hiring an attorney, otherwise, you may use an online estate planning service provider. Drawing estate plans through online services will be much easier and cheaper than creating them through an attorney. However, you should note a few crucial points for using online services. Not all online estate planning providers are the same. Their services and offerings may differ from one provider to another. There are online estate planning services geographically specific and some of them provide country-specific estate plans. There are also worldwide estate planning services, such as Wassiyyah, which provides exclusive global solutions. While others provide specific types of estate plans, such as they offer only Wills but not others, and some of them offer Trust but not others. Using online services, you highly rely on administrative control and read every instruction and detail that the service provides during the estate plan creation process. Always shoot questions rather than guessing to ensure nothing is missed. Whichever online service you use, ensure you are clear about their services.

#4 Tax efficiency
Estate planning strategies should consider the tax implications when creating Wills, Trusts, and Deed of Gifts. Generally, there is nothing you should worry about regarding taxes for Power of Attorney and Living Will. An estate may be subject to government taxes such as wealth tax, estate tax, death tax, inheritance tax, and capital gain tax. Taxes are the common challenge most people may face when creating an estate plan, but mitigating the risk is where estate planning expertise comes in handy. It’s worth considering tax-saving strategies for estate planning; tax and accounting firms can advise on how to save taxes. Trusts, lifetime charitable donations, and gifts are some of the ways you could ease up your tax burden. You will need creative solutions if you own assets in multiple countries or jurisdictions. Also, if you have significant assets worldwide, you may need extraordinary estate plans, and you may have to consider more than one estate planning expert, accounting, and tax expert. So, in all these situations, DIY free templates and online services may not be adequate to fulfill your estate planning needs.

#5 Choosing Agents and Witnesses
Choosing the right agents (i.e., executors, trustees, guardians, attorneys, or donors) for your estate plan is essential. You should carefully consider choosing an agent because it’s not just how much you trust them that matters: their age and health may influence your estate plans. Once you rinse out the trustworthiness of agents, the formula to choose Agents and Witnesses is, All must be different individuals. It’s not necessary, but another formula is to choose the same people to be executors, trustees, agents, guardians, and donors. Selecting more than one agent is recommended but not a necessity. Choosing two witnesses is essential. Choosing younger agents and witnesses would give longer life to your estate plans.

#6 Plan wisely and smartly
Many people go into estate planning with the idea that they are making permanent decisions on investments that will be locked in forever. They find it difficult to resolve issues based on today’s knowledge and circumstances. The prospect of a decision that locks one’s heirs in for decades can be paralyzing. As a result, they make no decisions, and the plan doesn’t follow through. Getting optimum investment advice is not an issue because many professional financial services, including banks, can guide you to optimize your investment strategy to help fulfill your estate planning goals. So, utilize them effectively to make intelligent decisions. Do not lock your investments unless it is necessary. The point here is; you should keep the estate planning goal in mind while making investment-related decisions so that your children and family members do not suffer.

#7 Consider your values and legacy
Your estate plan reflects your values and the legacy you want to leave behind. Often, it has a significant effect on how people remember you. Consider the values important to you regarding wealth, expectations for your heirs, obligations to your heirs, wealth management lessons you want to leave, and charity. Some people find it helpful to draft a mission statement, letter of wishes, and funeral plans. Then, the estate plan can be drafted to advance the values in the document. For many people, it is essential that faith is one of the priorities related to various inheritance obligations. Involving family members in preparing such vital documents is one of the ideas one can explore. You are not only creating an estate plan but educating and inspiring your family members on how important it is so they can make their estate plan a top priority.

The information provided here is not for investment, tax, legal or financial advice.