Just about every adult can benefit from having a will in place. Even a simple will can provide peace of mind to the testator (the person completing the will) and his or her loved ones by making arrangements for the distribution of assets.
However, a will only goes so far in protecting a person's wishes and assets. To take a more comprehensive approach to planning for the future, and to address matters not included in a will, you should have an estate plan.
Distinguishing between wills and estate plans
Often, people assume that a will is the same as an estate plan, or that there is no need for additional planning if you have a will.
However, a will is not the same as an estate plan; it is a part of an estate plan that details how you want your assets distributed. On the other hand, as this Kiplinger article notes, an estate plan refers to all the planning documents for a person's affairs. It can include:
- Powers of attorney
- Health care directives
- Directions for assets not inherited through a will
In other words, an estate plan can include numerous planning documents, one of which should be a will.
Having more than a will
Once you have a will in place, you can also explore the other elements of an estate plan. Having a will is a very good start, but it likely won't address all your long-term and end-of-life wishes.
You can complete additional planning documentation to accomplish goals like minimizing tax penalties, assigning decision-making roles and providing explanations for your loved ones in an effort to prevent disputes.
Putting -- and keeping -- it all together
Estate planning is not something that you have to do all at once. You can complete elements of your plan as they become beneficial and relevant. Many people start with a will and then add to it or make adjustments over time, which can also help to keep documents updated.
No matter how you approach your own estate plan, just know that having a will is critical, but there is more to an estate plan than a will.