Estate planning together with the writing of wills is something that most of us neglect to do. But whether you are rich or not; whether you pay income tax or not, it is essential the an estate planning task is carried out. And to make it easy for you here are some exhaustive tips.

The first and foremost act that you should do is to provide for your children. Your will must have somebody, who you trust and who you know will carry out your wishes for your children, named as a guardian and a financial trustee. This is essential, if unfortunately, both you and your spouse die. There are some precautions that you should take when you name a guardian and a financial trustee.

• Do not name the same person as the guardian and the financial trustee. This is just a safeguard to provide checks and balances.
• Do not name couples as guardians. There is a possibility that they might disagree as to what is good for your child or they might break up.
• Even if you are divorced, it is your children's natural other parent that will get legal custody of the child, unless he or she happens to be mentally unfit or there is and addiction involved.

Your Will

What are the provisions that should be in your will? What shouldn't? If you do not write a will or if your will doesn't contain any specific beneficiaries, and you die, it is the state that is going to decide on who gets what and that is a very long process. But before you write a will consider doing the following things first and regularly.

• Give away your assets before you pass away. Transfer them to a trust or put them in a joint tenancy. You can also gift up to $12,000 annually to as many people as you like; pay for the educational and medical expenses of someone you know directly to the respective institutions and these will not attract any Federal gift tax.
• Keep your retirement and insurance policies current. Do not make them part of your will. The benefits of these policies will automatically come to your spouse unless a waiver has been signed by him or her.
• Review your will and estate plans regularly and whenever there is a major change in your life's circumstances. 
• It is mandatory in many States that your spouse gets a third of your estate even if your will says otherwise. Check out your States laws. If you want your spouse to get more, then consider transferring a part of your estate to him or her before you die.

Some of the things that should be and shouldn't be in your will are listed below.

• If your spouse passes away shortly after you do, a simultaneous clause in your will see that your children get your estate.
• Suppose you have children from a prior marriage and you want them to have some or your assets, do not leave everything to your present spouse. Provide a bypass trust to ensure a regular income for your spouse (till death) and the estate goes to the children.
• Put it clearly, without any ambiguity, the children you would like to disinherit.
• Avoid tying a persons behavior to his bequest. A spendthrift or a testamentary trust will see to it as to how the money is distributed to the irresponsible heir so that he or she cannot squander it away.

Some of the things that you should do after you have planned your estate and written your will is to

• Review them regularly especially after major changes in life. If you happen to remarry, think of a pre-nuptial agreement; if you shift residence to another State, check out the estate laws particular to the State and make necessary changes.
• Keep your insurance premium paid up to date and change the nominees if necessary.
• Appoint an Executor and, if necessary, a backup 

Fulfilling Your Last Wishes

After your death, it is the responsibility of the Executor for the valuation of your assets, pay off any current debts and taxes and distribute the remaining assets to the beneficiaries according to your wishes in your will. He or she has to ..

• Probate the will in a timely fashion. There usually is a time limit for doing so and the limit varies from State to State.
• Make a thorough search of your home to locate any important valuables and documents that could be hidden away in dresser drawers etc. Hopefully, financial records and other secretive data such as computer passwords and Personal Identification Numbers are in one secure place. If kept in a safe deposit locker, the Executor may need a court order to open it.
• Pay mortgage and utility bills. Change the locks. Change the name on the house owners insurance to that of the estate.
• Prepare the house for sale, if necessary.
• If there are any items to be donated, according to your wishes, receipts must be obtained.

Taxes

According to current laws, only estates worth over $3.50 million are subject to Federal taxes. This tax disappears in 2010 and reappears in 2011 with a $1 million threshold unless otherwise decided by the Congress.

According to the Internal Revenue Service, only 2% of the population, the wealthiest, pay Federal taxes. Some States have an inheritance tax also, to be paid by the heirs. That portion of the estate left to the spouse are not included for taxing. Others that qualify for deduction include debt, funeral expenses, charitable gifts and costs.

Estate tax obligations can be brought down in many ways such as a bypass trust, a life insurance trust, a irrevocable living trust and a charitable remainder trust.

If you have a larger estate, the above are the provisions that should be taken into account while planning your estate and writing your will.

If you cannot come to a decision as to what to do, the least you can do is to prepare a durable power of attorney for handling your finances and a proxy for your health care, if unfortunately, you become unable to take any decisions about your health requirements. You can consider a living trust also.

Surprisingly , you even have some funeral rights. You can read the Federal Trade Commission's Funerals: A Consumer Guide (a pdf file) and you can save on expenses with direct cremation.

So be wise and take a decision now to plan your estate immediately, review your retirement benefits and your insurance policy.