There are several solid reasons to prioritize estate planning.
A shocking number of Americans do not have an estate plan.
Because estate planning encompasses incapacity and end-of-life issues, those without a plan place their loved ones in a tough situation.
According to a recent c|net article titled “Estate planning 101: Your guide to wills, trusts and all your end-of-life documents,” comprehensive estate plan involves more than signing a last will and testament.
With a thorough estate plan, you address a several essential issues.
What are they?
Your estate likely includes a variety of assets.
You probably have a car, a home, jewelry, keepsakes, investments, retirement funds, and life insurance.
If you are a small business owner, your business is included in your estate.
Not everything can or should pass through your last will.
Work with an experienced estate planning attorney to ensure that your assets are properly “aligned” with your estate plan.
Preparing your family for life without you.
Your loss can leave your family vulnerable without proper planning.
If you have minor children, this is particularly true.
You will want to name a guardian for your children as well as an individual to manage their finances.
Although the same person could serve in both functions, it may be wise to divide the responsibilities.
If you do not choose a guardian, one will be selected for your by the court.
Assigning authority over health care and financial decisions.
Estate planning includes incapacity planning.
Your bills will still need to be paid.
Medical decisions will need to be made.
You will want to select a trusted individual or individuals to accomplish these tasks by granting them a power of attorney.
When you die, someone will need to manage your estate.
You should also selected someone responsible to serve as your executor, also known as a personal representative.
The executor will be responsible for negotiating with creditors, distributing assets, and managing the sale of your home or business.
Working with an estate planning attorney.
DIY estate plans are generally bad ideas.
The stakes are high.
If you mess up, the problem may go unnoticed until it is too late.
You have died and the issue cannot be remedied.
An experienced estate planning attorney will be able to create a plan to efficiently manage your estate, account for federal and state laws, and minimize tax liability.
Oh, and your attorney can also help you avoid family feuds over your estate.
Documenting everything properly.
An estate plan must meet certain criteria and specific steps must be taken for it to be legally valid.
Without a valid last will, you will be at the mercy of the probate courts.
You will have no say in who receives what when it comes to your assets or who rears your orphaned children.
In some instances, you may want to avoid probate completely.
In that case, you would need to create and “fund” a revocable living trust.
If you have strong opinions on end-of-life care, you would address them in an advance health care directive to help guide doctors and the agent named in your medical power of attorney.
Estate planning cannot be delayed.
Meet with an experienced estate planning attorney to create or review your estate plan as soon as possible.
Reference: c|net (June 8, 2020) “Estate planning 101: Your guide to wills, trusts and all your end-of-life documents”