A will is the most common way to leave an inheritance behind, and it’s very important to have one. It can be complex or as simple as splitting your assets evenly among all of your heirs. It’s up to you. But a will isn’t the only option that you have.
There are a lot of ways to leave money to family members and others, and you may want to consider them. Many can be used along with your will. Examples include:
- Trusts: A trust can give your heirs the money under the conditions you create, such as giving it to them at a certain age or requiring them to use it for school.
- Life insurance policies: When you buy a life insurance policy, it’s not part of your estate. However, you name a beneficiary who will get that money when you pass away.
- Retirement accounts: As with a life insurance policy, you name one or more beneficiaries who will directly receive any money left in the account.
- Gifts before death: Don’t assume that your heirs and beneficiaries must wait until you’re gone to benefit from your generosity. You can start distributing assets whenever you’d like.
- Payable-on-death accounts: You can add a payable-on-death beneficiary to your bank account. When you pass away, instead of putting the money into your estate to be handed down, the bank just gives access to whomever you named.
As you can see, estate planning includes many different options. Be sure that you consider all of yours carefully to find the best solutions for you and your family.