Before it's too late

Personal Finance: Three key steps in estate planning | David Bahnsen

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Many people find estate planning uncomfortable. Accepting mortality is hard for all of us, but proper financial planning demands it. Frequently, individuals tend to view estate planning as a mere financial exercise: what assets to give to whom, and under what conditions—but providing for the transfer of financial assets is only one piece of the puzzle.

My last column laid out five key questions a believer ought to ask himself when beginning to plan for his estate, and then referred to a revocable living trust as a potential part of estate planning. While this instrument is a powerful tool for many people, it is not necessary for all. Other elements to a complete estate plan ought to include:

1. A will

Even with a living trust, a legally valid will is an important document to complete. It deals with the distribution of assets that may not have been covered in a trust. If your legal and financial advisors deem a trust unnecessary, a will becomes the document that defines who your beneficiaries (those receiving your assets) will be, and under what conditions they will receive them. It also names an executor to oversee these affairs after your passing.