Estate Planning Basics

What is an Estate Plan?

An estate plan is a collection of documents designed to protect your wishes should you become incapacitated or pass away.

Do I Need an Estate Plan in South Dakota?

There are five main reasons you need an estate plan.

  1. An estate plan allows you to decide who gets what when you die.
  2. An estate plan names who will watch over your minor children when you are gone.
  3. An estate plan can help minimize death taxes you may owe.
  4. An estate plan can help avoid probate in South Dakota.
  5. An estate plan allows you to appoint who will make important financial and medical decisions should you become incapacitated.

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What Estate Planning Documents Do I Need?

There are five main documents to have in your estate plan.

  1. Last Will and Testament. This document states how you’d like your property to be distributed after your death. It also allows you to name guardians for your minor children.
  2. Revocable Living Trust. Allows for assets to transfer without going through probate court proceedings.
  3. Advanced Healthcare Directive. This spells out your wishes regarding medical care if you become terminally ill.
  4. Durable Power of Attorney. Allows you to appoint someone to act on your behalf for financial decisions.
  5. Beneficiary Designations. For retirement accounts and life insurance these name who directly receives those assets.
  6. Letter of Instruction or Letter of Intent.

When Should I Update My Estate Plan?

Here are five scenarios when you should make updates to your estate plan.

  1. Marital changes.
  2. Changes to beneficiaries.
  3. New children or grandchildren.
  4. A significant change to your net worth.
  5. Tax law changes.

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