Planning Your Estate

According to Wikipedia, Estate planning is the process of anticipating and arranging for the disposal of an estate. Estate planning typically attempts to eliminate uncertainties over the administration of a probate and maximize the value of the estate by reducing taxes and other expenses. Guardians are often designated for minor children and beneficiaries in incapacity. 


There are many tools in estate planning. Some of them are:-
1) Wills
A will or testament is a legal declaration by which a person, the testator, names one or more persons to manage his/her estate and provides for the transfer of his/her property at death. For the devolution of property not disposed of by will, see inheritance and intestacy.


2) Trusts
This is an arrangement where a trustee is appointed to hold property for loved ones (Beneficiary) or other purposes. The person who set up the trust is known as the "Settlor" and the terms he can spell out for the trustee to management the trust is called "Trust Deed". There are many forms of trusts, Testamentary Trust, Living Trust, Implied Trust, Express Trust, Constructive Trust, etc..which can be formed to meet various need of people.


3) Life Insurance
Life Insurance is an excellent tool for providing liquidity to one's estate, for the replacement of income and for those who wish to create a sizable estate with a small outlay. By nominating the spouse and/or children (if the testator is married), or the parent (if testator is unmarried), a trust is created in favor of the nominees. The death proceeds is a separate estate and is out of reach of his creditors in the case of bankruptcy.