Estate planning is the process of making arrangements for the management and distribution of your assets after your death. It's important because it allows you to dictate how your assets will be distributed, minimize estate taxes, avoid probate, and provide for your loved ones according to your wishes. Without an estate plan, your assets may be distributed according to state law, which may not align with your intentions.

Common documents included in an estate plan include a will, which outlines how your assets should be distributed; trusts, which can be used to manage and distribute assets during your lifetime and after your death; powers of attorney, which designate individuals to make financial and healthcare decisions on your behalf if you're incapacitated; and healthcare directives, which specify your wishes regarding medical treatment.

Probate is the legal process of administering a deceased person's estate, including distributing assets and paying debts and taxes. It can be time-consuming, costly, and public. Estate planning strategies such as creating trusts, titling assets jointly with rights of survivorship, and designating beneficiaries for assets like retirement accounts and life insurance can help avoid probate and streamline the distribution of your assets.