Many people think that estate planning is for the elderly and wealthy. You may feel a plan is not necessary because you are too young or you do not have enough assets. But any adult can benefit from estate planning. While you may not need to create a trust or even avoid probate, there are plenty of reasons to being estate planning now:
- Loss of Capacity. What if you become incapacitated and unable to manage your own affairs? Without a plan, a court will select a person to manage your affairs through intrusive and expensive guardianship or conservatorship proceedings. With a plan, you can use a durable power of attorney to make that choice on your own.
- Minor Children. A will is the cornerstone of estate planning, and it names a guardian for minor children. Without a will, a Probate Court will make the decision.
- Dying Without a Will. Without estate planning, your assets will pass to your heirs according to your state’s intestate laws. Your family members will receive your assets without your input. With a plan, you decide who gets your assets.
- Blended Families. What if your family is the result of multiple marriages? Without a plan, children from different marriages may not be treated as you would want, in fact your own children may be disinherited. With a plan, you determine what goes to your current spouse and to any children from a prior marriage.
- Keeping Assets in the Family. Without a plan, your child’s spouse may wind up with your money if your child dies prematurely. If your child divorces his or her current spouse, many of your assets could go to that spouse. With a plan, you can set up a trust that ensures that your assets will stay in your family and pass to your grandchildren.
- Financial Security. Will your spouse and children be able to survive financially without you? Without a plan, and an income replacement, your family may be unable to maintain its current standard of living. With a plan, estate planning tools such as life insurance can mean that your family will enjoy financial security.
- Retirement Accounts. Do you have a retirement account? Without a plan, the designated beneficiary of your retirement account funds may not reflect your current wishes. With a plan, you can choose the beneficiary and an estate planning attorney can make sure it coordinates with all aspects within your estate plan.