Preparing for your passing can be a stressful and confusing process. You have to make big decisions about who will take over your home or who will have your belongings if you live in personal care.
It also can stipulate what medical care they wish to take if they begin having a memory condition and need the help of memory care specialists.
But there are two major types of planning that you should be prepared for in case the worst happens: legacy planning and estate planning.
Estate planning takes care of all the tangible things, such as personal belongings, collections, and vehicles. In contrast, legacy planning is about how knowledge, heritage, wisdom, and assets will be passed on to those you love.
What Is Estate Planning?
Estate planning is the process of arranging the transfer of your estate after your death, using either a will, trust, insurance policies, or other devices.
Effective estate planning is crucial for various reasons. One of the most significant advantages of planning ahead is that it can empower you to determine how your estate should be managed and what your loved ones should receive when you’re no longer around.
You can align your aspirations for tomorrow by taking the necessary steps today.
Planning Ahead
One of the key differences between legacy and estate planning is that estate planning involves all assets that have a monetary value. This often includes:
- Money
- Cars
- Recreational vehicles
- Boats
- Clothes
- Jewelry
- Real estate
- Investments
- Savings
- Retirement accounts
- Land
It also concerns where any minors under your care will go. This process involves writing a Guardianship document, as well as a will and a trust.
A will is a legal document that states where all your assets will go. A trust is an agreement where one party (the trustee) will hold property and other assets for a beneficiary.
A guardianship is usually part of your will and involves where all dependents will go after your passing. This includes minors and seniors under your care.
You have successfully completed an estate plan if you cover all these things for your end-of-life plan. But a legacy plan goes a few steps further.
What Is Legacy Planning?
Beyond the technicalities of estate planning lies the importance of legacy planning, which involves incorporating a personal touch into the process.
Legacy planning is often used synonymously with estate planning, but it takes a more holistic and personal approach to what you will give to those you love.
This includes documenting your values, beliefs, family history, and other significant aspects of your life and ensuring that your legacy reflects these beyond the distribution of material wealth.
A Personal Approach
Legacy planning can include placing conditions upon where or to whom the assets will be going. You can even split the payments for younger beneficiaries so they do not spend the money due to financial inexperience.
With legacy planning, you can assign heirlooms to who you chose and pass traditions down.
Other specifications could include things like a business you’ve built, and you could provide guidance on how you’d like it to be managed in the future.
Many of these things can be put in a will, but you can also add a letter or video with these directions to make a stronger impact on those left behind.
This letter or video will not be legally binding, but it will give your relatives confidence that your wishes are followed and hopefully set aside any disagreements.
Planning Your Estate & Legacy
When planning your estate and preparing for the end of your life, it’s wise to seek the guidance of an experienced attorney and a financial advisor. This is particularly important if you have a sizable estate with numerous assets to allocate.
While legal fees can vary from a few hundred to several thousand dollars, enlisting the help of estate planning professionals can help carry out your wishes and take care of your loved ones.
Contact us at the Landmark at Southgate in Southgate, MI. If you are planning for future care in assisted living or memory care, we are available to answer your questions so you feel confident in your end-of-life planning.
