We may be living during uncertain times, but there is still one thing that has always remained certain in life—none of us are going to live forever. However, of course, no one wants to admit their eventual mortality. It is something that we dread to think about, but we must all prepare for it. Having an estate plan is one of the most important things that you can do for your loved ones (and for yourself), so why is it that two-thirds of Americans do not have any type of estate planning document? The reason may be that many are not familiar with the importance and advantages of having a proper estate plan… If that’s why you’re reading this article, you’ve come to the right place.
Here are five ways everyone—including you—can benefit from proper estate planning:
1. Peace of Mind
The single most important benefit of an estate plan is peace of mind, for both you and your loved ones. Once you have effectuated your estate plan, you will have peace in knowing exactly how your family is going to be taken care of, how your business will be handled, and how your assets will be transferred. Whereas, dying intestate (without a will) inflicts a massive burden on your loved ones. Not only will they be grieving your death, but they will also be faced with handling the probate of your estate.
2. Simplify or Avoid Probate
Probate is the legal process of administering a decedent’s assets. This process can become extremely difficult, time-consuming, and quite expensive if one dies intestate. Without proper planning, it could take months, or even years, for your assets to be transferred to your beneficiaries. Depending on your state’s intestacy laws, if you die without executing a will or trust, your assets may not pass to your intended beneficiaries in the way that you desire. Moreover, probate court costs and attorney’s fees can total tens of thousands of dollars for the simplest estates, and even more for larger estates. Probate can be simplified by creating a will, or probate can be avoided by creating a living trust, amongst other estate planning strategies.
3. Appoint Guardians for Your Children
Have you ever thought about who would take care of your children if you were in a major accident or suddenly passed away? If you have not planned for this scenario, you may not realize that you are ultimately leaving it up to the courts to decide who will raise your children. This is one of the most important aspects of an estate plan for someone who has minor children. Would you rather predetermine who will take care of your kids, or would you rather have a judge decide? You should be the judge of that decision.
4. Minimize Tax Liability
One certainty in life is death; another certainty is paying taxes. However, depending on your situation and assets, there are many different estate planning techniques that can be used to minimize taxes paid by your estate. For example, with an appropriate plan, you may be able to reduce or even eliminate your death tax bill.
5. Protect Your Hard-Earned Wealth
Anyone with any assets needs protection, and asset protection goes hand-in-hand with estate planning. Trusts and certain business entities (e.g., LLCs) are common estate planning tools that can help shield and protect your assets from frivolous lawsuits, bankruptcy, divorce, and more. Think of it not as “whether” these things could happen, but “when” a serious problem could arise.
It is never too soon to create an estate plan, but there comes a time when it could be too late.
Contact Heather Lee O’Keefe of WFP Law at 954-944-2855, ext. 3 to learn more about estate planning and find out what kind of plan would work best in your situation.