Estate planning is something that many people do not understand. You may know that it is preparing for what happens with your assets after you die, but it is actually much more than that.
Due to misconceptions about estate planning, you may not think it is something you need to do. According to U.S. News and World Report, some people push off creating an estate plan because they feel they do not have enough assets to bother or that they are not old enough. Others may not complete an estate plan because they mistakenly believe having a will is enough.
What a will can do
A will is a great start to an estate plan, but it has limitations which means that it is not the only document that you need. A will can outline your wishes in regards to what you want to happen with your assets after your death. You can also use it to outline other desires, such as your funeral arrangements.
What a will cannot do
What a will cannot do is cover accounts that have a beneficiary or that you jointly own with someone else. It also does not allow you to outline what you want to happen if you are unable to vocalize your own wishes, such as in the case of a medical emergency.
What will cover the gaps
What you need to cover the gaps with your will is a more complete estate plan that includes powers of attorney and a health care proxy. These things enable you to state who will have the right to handle decision making for you if you are unable to do so.
You also need to be sure you name beneficiaries on all accounts that allow you to do so and keep them up to date. You also need to discuss arrangements with joint owners of assets and what you wish to happen upon your death.