Author: Dan Rafter / Source: Wise Bread
There are no guarantees when it comes to the number of years everyone gets on this earth. You may plan to live well into your 90s, but circumstances — and your health — can change very quickly. This is why it’s important not to put off the uncomfortable but necessary work of planning your estate.
Not sure where to start? Ask yourself these five key estate planning questions.
1. Why haven’t I created a will?
You might not be rich, or even old, but that doesn’t mean you don’t need a will. A will is for anyone who wants to leave behind assets to loved ones or specify who should raise their children if they die.
That last point is especially important. If you are a parent of young children, you need to spell out in a will who should take guardianship of your sons or daughters should you unexpectedly pass away. If you don’t, the courts will make that decision for you. Don’t leave this up to chance. Draft a will and include these instructions. If you already have a will but you’ve had a major life change since you wrote it, it’s probably time to update your will.
It’s best to work with a legal professional when drafting your will. A professional can help you list clearly who gets what assets. If you want to leave your home to a loved one after you die, you might need to take the extra step to create a trust, too. This can get complicated, so again, it’s best to work with an attorney. (See also: Here’s What Happens If You Don’t Leave a Will)
2. Do I have enough life insurance?
Life insurance is a necessary financial protection for your loved ones.
If you should pass away unexpectedly, would your spouse be able to afford the monthly mortgage payments? Would your children be able to remain in the home in which they’ve grown up?Life insurance can help ensure that your loved ones don’t have to worry about paying their bills after you die. Upon your death, your life insurance will give an agreed-upon payment to your beneficiary, who can use that money to cover anything from mortgage payments to college tuition.
There are two main types of life insurance: term and whole. Term life insurance is less expensive but still provides solid coverage. With this type of insurance, you pay a premium for a certain number of years, perhaps 20 or…
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