Cornerstones of Estate Planning

Over the past 12 years that I have been helping people to develop better money habits, I have heard some really disturbing stories from families that did not prepare their financial estate.

Many of these stories ended up with family fights over property and money which totally destroyed those relationships.

To help you understand the basics, and help you avoid tension in your family, here are the 4 cornerstones of estate planning that the AARP suggest you get taken care of.

1. Have a Will.

This legal document specifies who will manage your estate, who will get your belongings, and if applicable, who will become the guardian of your minor children after you die.

2. Durable Power of Attorney.

This delegates the power to legally handle your financial affairs should you become disabled or incapacitated.

3. Letter of Instructions.

This is an informal document that gives your survivors information about important financial and personal matters that must be attended to after your passing.

4. Advance Directive.

This is a catch-all term that refers to your health wishes, living wills and medical power of attorney, as well as other personalized directives.

The big thing to remember here is this: Don’t wait till it’s too late to get your estate planning done.

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