What Is The Definition Of An Estate?
A lot of people don’t really understand the definition of an estate because the word estate can actually mean several different things. As a general term, the definition of an estate essentially means those things that you own; whether you own them by title, as part of your personal property that is in your house, or whether you have the rights to them through some form of a Trust or life insurance payout. Everything that could be attributed to you that could ultimately break down into monetary value that goes into what your total accumulated assets would be considered your estate. When a person passes away, everyone understands the term estate. Estate basically means all of the stuff that they left behind. But, during your lifetime, you also have an estate.
People don’t often take into account life insurance as part of their estate. A young couple who has a bunch of debt, a baby, and who are both earners but are just in the early stages of their careers might have some kind of life insurance policy (maybe two million dollars each). If they were to pass away, then that money would go into their estates and they should account for that when they are considering what is in their estate. The term estate is not a very difficult term, but it’s often misunderstood. It essentially means that everything you own, whether by title, by ownership or everything that you are entitled to by right (whether as a beneficiary of some other Trust or a beneficiary of a life insurance policy).
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