Estate planning is a valuable process that should be started long before you need it. An estate plan is essential for protecting assets and executing your wishes. You may think you have plenty of time to start but creating a plan sooner rather than later is a wise idea. Here are some things to consider when planning for your estate that will help you through the process.

• Understand the documents – Estate planning can be a complicated process that involves many legal and financial documents. It’s essential that you understand the components of your plan and the language used in the documents. If anything is unclear, don’t hesitate to ask your attorney for more information. Don’t feel embarrassed. It is their job to make sure you are knowledgeable enough to make the appropriate decisions.
• Think about including a living will – Estate planning primarily focuses on what to do with your assets after you are gone but remember that this process can also cover what to do if you are incapacitated due to illness or injury. These instructions are handled within a living will. Does your family know what your wishes are if you were to be in a coma or to lose your mental faculties? Creating a living will can take the guesswork out of these scenarios.
• Update your beneficiaries – Who do you want to give your assets to after you are gone? Do you want to divide your estate evenly or based on another scenario? Carefully consider your beneficiaries and how your assets might best support your family. Make sure you update your beneficiaries periodically, especially as your circumstances change. You don’t want to accidentally leave everything to an ex-spouse or a loved one who has already passed.
• How to handle estate tax – One of the main goals when estate planning is how to reduce the potential tax burden on your estate. Taxes are levied on surviving dependents (not spouses) after an applicable deduction. Depending on the size of your estate, these taxes can take a hefty chunk out of your beneficiaries’ inheritance. You could consider gifting money out early or you could create a trust to reduce the burden on your family.
• Do you need a trust? – A trust can be a useful way to protect your estate in certain circumstances. Standard estate scenarios usually don’t benefit from trusts since the fees to create and maintain them are prohibitive. But if you have a large estate, a complicated family structure, a public persona to protect, or disabled dependents, a trust can help establish more guidelines for your estate than a traditional will can. Trusts can also be used to quickly liquidate an estate and free up money to pay estate taxes.
• Is life insurance right for you? – Life insurance can be a useful addition to your estate plan given the right circumstances. These payouts are not subject to estate taxes, so life insurance plans can be used to minimize the tax burden. Just be sure that you are doing the math to offset the premium payments with the expected payout.

Estate planning is one of those things you want to carefully consider and strategize, not rush through. That is why it’s never too early to start thinking about your estate plan. Talk to your financial advisor and an attorney to take the next steps.