As we enter 2022, you may take the time to reflect on the past and plan for the future. This could mean thinking about your legacy and taking care of what is most important to you.
Thus, if you haven’t done so already, creating an estate plan can be a step worth taking this year.
Defining your wishes
A new year can put our priorities in perspective and help us recognize what we want and value. You might decide to be more philanthropic in the future or to build more meaningful relationships, or you might decide to be wiser with spending or quit unhealthy habits.
These are not just resolutions; they are reflections of our beliefs and wishes. And you can preserve these in an estate plan by defining your financial values, appointing people to make decisions on your behalf and providing guidance for difficult decisions, which we discuss below.
Making difficult decisions
When someone gets very ill or passes away, other people may have to make painful choices. They may need to decide:
- What type of medical treatments a person receives
- Who will take care of a person’s financial affairs
- When and whether to stop life-saving efforts
- Where to lay a person to rest
Estate planning alleviates the burden these matters can put on loved ones by spelling out what you want and do not want others to do. Providing this direction can minimize doubt and unanswered questions, helping loved ones feel more confident as they navigate painful situations.
Taking stock of your financial legacy
The primary function of estate planning is to distribute and finalize a person’s money, property and other financial matters. Whether your estate is massive or modest, there will be a legal process to distribute everything in it.
When you create a will, trust and other planning tools, you create a roadmap for the courts and those you leave behind. You can dictate everything from charitable gifts to which family member receives a priceless heirloom.
Making these decisions yourself can ensure the legacy you leave is an intentional one.
The value of looking ahead
The start of a new year marks an opportunity to look toward the future and decide how you want to shape it. Creating an estate plan can help you accomplish this.