Why Everyone Should Get an Estate Plan

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When people think of estate planning, they might believe this is something only the very wealthy have to address. The truth is, an estate plan is one of the most important documents that you consider and execute, and they aren’t just for the rich. Surprisingly, many people don’t even realize that they, themselves, have assets that could be protected with an estate plan. If you have minor children, it is an absolute necessity.

Essential Items to Consider

Protect Yourself in Medical Life/Death Situation

First and foremost, consider a living will or advance medical directive to protect your family and guide them to make important decisions about your own health care and life if things suddenly got very serious. Should an accident or illness occur and you become incapacitated, this can be an important document to give you a voice during a critical time when you would otherwise be in no condition to speak for yourself. Additionally, it can make sure your spouse or a trusted person has immediate access to financial accounts if you are unable to give them permission.

Protect Real Estate 

If you have any real estate at all, it is worth considering what would be the best use for it when you pass on. By planning for what happens to real estate in the event of your death, you can avoid probate court and pass the property to your spouse or another person immediately and with minimal legal actions. There are a number of ways to title real estate that allows the property to pass to a beneficiary without probate, which will vary by state.

Protect Financial Assets

Have a bank account? Stocks or other securities? Life insurance policies? Money from these types of assets can be passed to beneficiaries without going through the probate process, which can take time and money. An estate planning attorney can help you title the accounts and beneficiaries properly for a smooth transition and minimal tax liability. The use of trusts, particularly for life insurance policies, can ease access to this money for loved ones and minor children after death and can allow them to maintain government benefits that they otherwise might be excluded from if they receive a large gift of money.

Protect Your Children 

Do you have a minor child?  Who should be their guardian if you were gone?  Sorting this out will help protect the child from additional trauma in the unlikely event that both parents pass away. When parents die and there is no named legal guardian, the state will place the children where it wants, which could even be a foster home. It is vital that their well-being is planned for and considered.

Protect Your Personal Property AND Pets 

Personal property is not only the precious inanimate objects that you care about. Did you know that even your dear pets are lumped under the label “personal property?” Pets are very important to consider just in case you pass away.  

The Street, an online news source, reports that “a growing number of Americans are including their family pet in their estate plans.” This is a very good thing, to be honest because too many pets suffer, die of starvation, or end up at a pound and euthanized after their owner (aka mommy, daddy, master, human friend) was simply no longer alive to care for them. Sadly, this happens to at least 100,000 pets each year, according to the Humane Society. If you care about the wellbeing of your pet if they outlive you, then take time to create a pet trust or a guardian that you know will care for your beloved animal.

Protect Your Family from Funeral Debt 

Finally, some people have used an estate plan to make sure that their funeral is carried out a certain way. Perhaps certain arrangements can be made ahead of time. It is always very much appreciated by loved ones if plans are already made and taken care of because it provides them much needed relief during mournful times.

Tax and Probate Avoidance

Consulting an estate planning attorney can help you minimize any taxes and keep assets out of probate. It is not something most people enjoy thinking about or planning for, but it will be worth it for your own peace of mind and your family’s security.