A common misunderstanding is that people don’t think they need an estate plan because they’re not wealthy. This perception is a misperception. You don’t have to have an “estate” complete with tennis courts and a hot tub: everyone needs to make basic arrangements for who will inherit their “stuff” and who will take care of them should the need arise.
An “estate” includes everything from your home to your savings and retirement accounts, to the box of coins you may be keeping under your bed. There are a variety of ways to make sure that all these things end up in the right hands after one’s death.
A typical estate plan includes a trust to avoid probate, its fees and tax burdens, a back-up will, a durable power of attorney for financial management, and an advance health care directive.
Once one has an estate plan in place, it is important to update the plan when significant events occur, such as a new marriage, a new child, the death of a named executor/trustee, a major change in one’s financial status, or the death of a spouse.