India's most common forms of estate planning are making revocable and irrevocable trusts and Wills. These let them set and protect the plan for property distribution after their death.
What Is Estate Planning for Senior Citizens?
Estate planning lets individuals ensure that their properties will be distributed according to their intentions after they die. As death is always unsure and beyond the control of any human being, all should ideally make sound estate planning for the well-being of their families.
For this same reason, if you are a senior citizen, you should consider making it without further. Here you can find some essential tips for estate planning for senior citizens that will help you ensure post-death wealth distribution and financial management according to your planning.
What is Estate Planning for Senior Citizens?
Estate planning for senior citizens refers to the process of property transfer or distribution after their death in a planned way. These assets can be your savings, death benefits of life insurance, automobiles, personal belongings, real estate, etc. The process also includes preparation for transferring their liabilities and debts to their legal heirs.
In estate planning, you need to make necessary arrangements so that financial decisions are made as per your intention, even after your death. You can set an individual of your choice for executing your estate planning beforehand.
Why Estate Planning for Seniors is Important?
Estate planning is crucial for all individuals; however, its necessity is more apparent for senior citizens for several reasons. They become more akin to falling sick with minor to critical illnesses with age.
Although it is hard to accept, they come near the end of their life. With proper estate planning in place, they can secure mental peace. They can stay assured that if they cannot make health or financial decisions for some reason, including death and disability, things will happen as planned.
What Are the Most Important Tips for Estate Planning for Seniors?
Here are some suggestions that senior citizens can follow while making estate planning:
- List Down All Assets: While making estate planning, you must consider how your properties and personal belongings will be distributed among your children, spouse, and other legal heirs. This is why you must first take an inventory of all your available tangible and intangible assets. After you make this list, you can clearly understand which beneficiaries will get a specific item or which properties will be distributed amongst beneficiaries.
- Monitor Debts: If you have pending financial obligations like a home loan, vehicle loan, and personal loan, you must make a list of them. This will give you a fair idea about the liabilities that can be conferred upon your legal heirs in case of your unfortunate demise in the middle of the tenure. After making a list, you can also understand what measures you may take so that the loans do not unnecessarily pressure your family members. In such a case, appointing an estate administrator can be advisable as they can help you repay all your debts before your properties are distributed.
- Make A Will: A Will contains your declaration of intention about the property distribution. Creating a Will is especially important for making estate planning for childless seniors as it can help them ensure that their properties are transferred to their preferred heir(s). In case of the absence of a Will, there can be legal proceedings or probate about the distribution of their properties. In such a scenario, a judge decides to distribute assets after their death.
- Appoint an Executor: While making your Will, you should appoint an executor responsible for executing your recorded testamentary after your death. When you appoint an executor, your family members will not have to engage in court proceedings. You can appoint any of your people as the executor of your Will. It can be a beneficiary or a third person.
- Consolidate Accounts If Possible: Consolidation of similar types of accounts is also essential for making sound estate planning for seniors. This is so because individuals generally have their funds in different accounts. If you also have accounts open in banks, post offices, fund houses, governments, etc., you may have faced difficulties managing them all. This is why you should consider making the number of accounts as few as possible.
- Consider the Creation of a Trust: You can also keep your assets protected by keeping them in a trust. After including your assets, you can determine your beneficiaries and what share of your assets each of your beneficiaries will get upon your death. This way, a trust lets you distribute your wealth amongst your legal heirs in a planned way. Further, your heirs will not have to undergo probate.
- Review Arrangements: You should ideally review all your documents, policies, and accounts occasionally to stay updated. Besides making a will and trust, all your savings and investment accounts must have nominees. This way, you can entitle your chosen person to withdraw money from your accounts.
Alongside this, by keeping your papers available, handy, and properly arranged, you can reduce the hassle of your legal heirs during the documentation process of bequeathing your assets or claiming life insurance death benefits.
Estate planning for seniors is not much different from that for individuals of other age groups. The only thing differentiating estate planning for these age groups is the urgency of making it. Since senior citizens are possibly near the end of life, estate planning becomes more urgent for them. By preparing estate planning, you can stay assured that the distribution of your properties and wealth will be as per your intent.
FAQs About Estate Planning for Seniors
The most important documents in estate planning are records of trust, Will, advanced medical directives, power of attorney, and beneficiary designations.
There is no particular age for creating trust because the unfortunate event of death can happen anytime. If you are a senior citizen and do not have trust, you should ideally make it without delay.
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