The objective of estate planning is to protect your financial interests in the event of your death or mental incapacity.

No one wants to think about their own mortality. You may even feel that questions about who gets which assets seem trivial in the context of death. According to numerous recent studies, only between 35%-40% of people around the world have a Will.

In the end, it’s up to your loved ones to answer these questions after you’re gone. By executing a Will and signing a few other basic documents, you can save them a lot of trouble and unnecessary expense – and allow them to focus on their loss.

Using ten steps, I’ll make this relatively painless.

  1. Know why you need a will.

The purpose of a Will is to tell the world whom you want to inherit your assets. Without one, you die “intestate” – without regard to your wishes or your heirs’ needs – and the Government (where you hold your assets) decides what happens to your property.

Therefore, you need a Will for each country that you hold assets in.

Common-Law countries allow you to give to whom you like – HK, UK, USA, Australia, Canada, and 75 others allow you testamentary freedom and you should take advantage of this. You can gift your assets in a common-law country to whomever you wish – the cat, dog, charities – your beneficiaries do not have to be family members.

There are 150 Civil-Law law countries (China, France, Germany) that will require you to include your children, even with a Will as beneficiaries. This is called Forced Heirship as the law requires you to distribute assets to your descendants. 

Also, making a will is especially important for people with young children, because wills are the best way to nominate guardianship of minors.

I advise a separate Deed of Guardianship to ensure that your children are not caught up in the time delays that can ensue with only guardianship instructions in your will. This allows the instructions for your minor children and other dependants to remain private – no court interventions..

  1. Take inventory and pick your team.

Start by creating a comprehensive list of your assets, including investments, retirement savings, insurance policies, real estate or business interests, and collectible and sentimental items for each country. It is amazing what we can amass and forget about. This list should be kept updated and with your Will so that your executor knows what to claim for.

Then spend some time thinking about the following questions:

  • Whom do you want to inherit your assets?
  • Whom do you want responsible for executing your will?
  • Whom do you want to name as guardians for your children in the event that you and their other parent dies?
  • Whom do you want handling your financial affairs if you’re ever mentally incapacitated?
  • Whom do you want making medical decisions for you if you become unable to make them yourself?

Once you have considered these basic questions, you will have established who would be in charge, who would inherit and what you would leave for them.

  1. Name an Executor.

A Will allows you to name your Executor, the person who will be in charge of claiming your assets, distributing your property, filing tax returns on behalf of your estate, and processing claims from creditors. Your Executor can be a friend or relative, or a professional like an accountant or lawyer, but it should be someone you trust and who is willing and able to take on the responsibility.

If you name a professional, the executor will be paid from assets in your estate. You should negotiate the amount or rate in advance; compensation can range from hourly fees to a percentage of your assets paid annually. Family or friends can claim back any costs involved from your estate when distributed.

  1. Consider your Beneficiaries.

We all know who our loved ones are but how do we decide on who gets what and when?

Most families want to give to their spouse then their children, with contingent beneficiaries being nieces, nephews and siblings. 

What if your spouse then remarries? You cannot guarantee that they write a new will to include the children and by default, the new spouse can receive your assets. 

Or what if your children are too young to inherit if you don’t have a spouse? Heirs have to be 18 to inherit financial assets.

I advise that you draw up your list of beneficiaries, which will allow you to consider more of what you own and how it can get to the next generation.

  1. Draft your will.

If your finances and wishes are simple, you may find that you can craft a quick and inexpensive will using a web-based legal document service – unless you know the process this is inadvisable as mistakes can be made easily.

You can hire a solicitor to draw up a Will and other documents for you such as Power of Attorney but tend to be more expensive and time consuming.

A Will writer will specialise in this topic, so will only focus on your wishes, have experience of claims and will cost something in the middle.

  1. Decide if you need a trust. 

Contrary to popular belief, Trusts aren’t just for rich people (though if you do have significant assets or young children, you should definitely want to think seriously about creating one.)

A Trust is a legal structure that lets you put conditions on how and when your assets will be distributed upon your death. Placing assets into a trust may allow you to reduce your estate and gift taxes and to distribute assets to your heirs without the cost, delay, and publicity of probate court, which administers wills. Some also offer greater protection of your assets from creditors and lawsuits. If these benefits sound appealing — and they should — you can learn more about trusts on the next stage of the road to wealth.

A Trust provides immediate distribution of your assets so if you are the main breadwinner in the family, another consideration is how your loved ones survive financially whilst all your assets are being assessed, claimed and distributed.

  1. Assign Power of Attorney.

No one is immune to the loss of mental clarity that may come with aging or from a health crisis. 

Granting someone you trust the Power of Attorney allows that person — known as your “agent” or “attorney in fact” — to pay bills, manage investments, or make key financial decisions if you are unable to do so. Your agent is empowered to sign your name and is obligated to be your fiduciary — meaning they must act in your best financial interest at all times and in accordance with your wishes.

The power of attorney instructions cease when you die, or become mentally capacitated again.

  1. Create a living will.

A living will (also known as an advance medical directive or health proxy) is a statement of your wishes for the kind of life-sustaining medical intervention you want, or don’t want, in the event that you become terminally ill and unable to communicate.

Most countries have statutes that define when a living will go into effect, and that sometimes restrict the medical interventions. Your condition and the terms of your directive also will be subject to interpretation. But a patient’s wishes are taken very seriously, so an advanced medical directive is one of the best ways to have a say in your medical care when you can’t otherwise express yourself.

It allows your loved ones emotional relief as they don’t have to decide on your life support care because you have instructed what can and cannot happen.

  1. Update your will.

Review your will every year. You’ll also want to update it after a major life change such a birth, death, or marriage, or if you buy some real estate or receive an inheritance. When you do this, also make sure your beneficiary designations on financial accounts, insurance policies, and other assets are up-to-date and coordinated with your will. 

Address changes do not matter in most cases but changes in beneficiary designations or asset jurisdictions should be considered.

  1. Communicate with your heirs.

Inheritance can be a loaded issue, so be sure to discuss your plans and expectations with your family and friends. The sooner and more distinctly you outline your intentions, the less chance there will be for disagreements when you’re gone.

In summary, preparing for the inevitable would alleviate the paperwork and confusion that occurs when people die without instructions in place. Your children would be in safe hands, all beneficiaries would receive the right amount with the right people in charge and your estate would pay minimal administration and legal fees.