Estate planning is not reserved for the super-rich


What comes to mind when you hear the phrase "estate planning?"

For some, those words conjure up images of super-rich families with complex financial agreements. In reality, estate planning is much more basic.

If you have assets -- cash, cars, homes, investments, jewelry, etc. -- you also have an estate. So estate planning is simply a process for building and preserving those assets during your lifetime, and it provides for an orderly transfer after your death.

Without such a plan, it's nearly impossible to establish a long-term financial strategy -- one that would protect family and loved ones after you die.

Estate planning involves three basic steps, says the Washington-based American Association of Retired Persons:

* List all assets and liabilities.

This helps you calculate your net worth, and it also can help survivors locate assets and creditors after your death.

* Define your objectives.

If you are a young parent, your primary goal may be to provide financial support for a spouse and children should you die prematurely. An older person may be more concerned about transferring assets to heirs or protecting an estate from taxes.

* Get professional advice.

There are a variety of estate-planning tools, each designed to meet different objectives. The tool you need may be a simple will or a complicated trust agreement. Find a professional in your state who is qualified to help.

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