Estate planning often has multiple benefits.
People tend to avoid doing things if they do not benefit directly.
Estate planning is one of those areas where people believe it is helpful for some people but not them.
Often the mistaken belief is such planning and preparation is only for the super-wealthy.
According to a recent Yahoo Finance article titled “3 Overlooked Benefits of Estate Planning,” this supposition is simply untrue.
Although estate planning benefits those with millions of dollars, it also helps those with modest estates.
These preparations are more about caring for your loved ones than they are about the figures on your bank statements.
If you have minor children, the benefits of estate planning far outweigh the costs.
Most parents want their children to be taught their values and surrounded by love and support.
A last will and testament is used to designate a guardian to rear your minor children until they reach adulthood if something were to happen to both parents.
Without this document and designation in place, the government chooses who will serve as the guardian for your children.
The courts could choose a family member you prefer not to parent your child.
In a worst-case scenario, you could leave your children with no viable option, and they could enter the foster care system.
Estate planning also has tax benefits.
Yes, even after you die, the government wants money from you.
Working with an experienced estate planning attorney can maximize the assets you leave to your heirs.
Even those not wealthy by American standards have property and possessions they will leave behind when they die.
An estate plan lets you direct who will receive bank accounts, real estate, life insurance, retirement accounts, stocks, investments, art, collectibles, vehicles, and jewelry.
Without a legally valid last will and testament, the probate courts will determine your heirs according to state law.
The benefits of having a comprehensive estate plan [a last will, general durable power of attorney, advance health care directive (which includes a health care treatment directive and a durable power of attorney for health care decisions), HIPAA authorization, anatomical gift declaration, and possibly a revocable living trust] go beyond simply dividing assets.
They also include protections should you become incapacitated.
You can choose who you trust to manage your finances or make medical decisions on your behalf.
Although having an estate plan is the first critical step, regularly reviewing and updating your estate plan as necessary is equally essential.
Life changes like births, marriages, and divorces can impact your plans.
Work with an experienced estate planning attorney to take advantage of the benefits of having a plan.
Reference: Yahoo Finance (April 24, 2023) “3 Overlooked Benefits of Estate Planning”