Estate planning is the process of arranging for the management and distribution of your assets after your death or if you become incapacitated. It’s important because it ensures your wishes are carried out, protects your loved ones, and can minimize taxes and legal hassles. It’s not just for the wealthy; everyone needs a basic plan.

Common documents include a will (directs asset distribution after death), a living will (outlines end-of-life care wishes), a financial power of attorney (authorizes someone to manage finances if you’re unable), a health care surrogate (authorizes someone to make medical decisions if you’re unable), and sometimes a trust (a legal entity that holds assets).

A will dictates how your assets are distributed after you die. A trust is a legal entity that holds assets, and can be used to manage and distribute them while you’re alive or after your death. Trusts can offer benefits like avoiding probate (the court process of validating a will) and providing more control over asset distribution.

You should review your estate plan periodically, ideally every 3-5 years, or whenever there’s a major life event like marriage, divorce, birth or death of a beneficiary, or a significant change in your financial situation. Laws can also change, requiring updates.

It’s highly recommended to consult with an estate planning attorney. They can provide personalized advice, ensure your documents are legally sound and tailored to your specific situation, and help you navigate complex issues. This is especially important if you have a complex estate or unique circumstances.