When the term “estate planning” comes to mind, we think of mansions, maybe some antiques, or any possession that can cost an arm and a leg, but estate planning isn’t just for the wealthy. Whether young or old, rich or not, every person can benefit from estate planning. That’s assuming you have assets you can leave behind and people to inherit them.
Even though an estate plan is vital, many people haven’t established estate planning because they don’t fully understand estate planning and what it entails. The assets notwithstanding, it helps to have a skilled lawyer who can manage your will.
This guide will give you insight into the benefits of estate planning using a simple format for fast interpretation.
What is Estate Planning?
Estate planning is a process where a person determines who will inherit and control their assets after their demise or if incapacitated. You have the final say in how things will run after you’re gone. It puts your affairs in order and leaves behind a written record indicating your last wishes.
The best part of establishing an estate plan is avoiding the taxes your heirs would have to pay to transfer assets after your demise. If you fail to develop an estate plan while you still have the time, state and probate laws will intervene when you’re gone, and you won’t like the results.
Why Do I Need Estate Planning?
Handling your affairs after your demise could be a long process, often costly without an estate plan. Even if you didn’t have that many assets or a large IRA, the process would still be the same. We’ve highlighted a few reasons you should establish an estate plan and avoid any unforeseen consequences or costs.
1. To Protect Your Beneficiaries
There are mainly two reasons people establish an estate plan: Secure the assets for minor beneficiaries, and prevent family disputes. Assuming your heir is still a minor, you’ll have to entrust a guardian to oversee all their needs until legal age.
You can avoid family disputes and overpriced legal expenses if you spare some time to appoint a trustee for the minor heirs. If the heir is of legal age but doesn’t make sound decisions and squanders money, you can establish a plan that will safeguard the heir.
2. Minimize Estate Taxes
The considerable amount of money one can lose while paying state and federal taxes motivates most people to establish an estate plan together. Even with the most basic estate plan, couples can minimize or do away with the estate taxes by establishing AB trusts in their wills. Also, there are numerous groundbreaking techniques you can use to reduce the tax bills or even eliminate them.
3. Avoid Probate
Probate involves a process of verifying a deceased person’s will and identifying the value of their assets, clearing their last bills and taxes, and allocating the remaining assets to the beneficiaries. Avoiding probate is probably the most common motivation for seeking an estate lawyer. Although most people have never experienced probate, they are all aware of one thing: they want to prevent probate, whatever the cost.
4. Protect Your Assets
Protecting assets is a great reason that’s considered even by those who have already established an estate plan. If a lawsuit is at the doorstep and you’re yet to establish a plan, you can consider another option. You’ll need to kick off with a sound financial plan followed by a comprehensive estate plan which will guard your assets before your demise and even after for the benefit of your heirs.
How Does Estate Planning Work?
Estate planning is essential no matter the value of your assets. We all have something of sentimental value or something essential to leave our beneficiaries. Establishing an estate plan ensures everything goes according to plan.
Suppose you pass on without an estate plan. The state court will have to determine how your assets will be distributed to the beneficiaries, regardless of your wishes. Even if you had stated your wishes earlier on, the court would still do as they see fit. So, unless you put it down in writing (legally), it’s most likely they won’t be considered. It can also have repercussions regarding child custody and distributing your assets.
Deciding on a power of attorney is also part of the process. The person you choose to assign will be your agent and someone you can place your trust in completely. For instance, most people select their spouses as their agents so they can manage their assets when they aren’t around.
Suppose you want to appoint someone to make decisions on your behalf when incapacitated. In that case, you’ll require to grant them durable power of attorney.
Lastly, medical power of attorney is crucial, especially since it involves your health or medical issues. Whoever you appoint as your agent for medical power of attorney should be someone close who fully understands your wishes on how to prolong your life.
For instance, if you’ve been in a coma, and the chances of you coming out of it are slim, your agent can decide if you should stay on life support or not. It also helps to discuss your views with your doctor in advance.
Contact Norman Mattar to Establish Your Estate Plan
No one wants to think of their demise. There are many more problems to worry about and stress only makes it worse. We wouldn’t have to worry about death if we could all live forever, but death is inescapable. Even if you didn’t sire children, not establishing an estate plan can stir problems between your family and friends who outlive you.
However, making your wishes clear before your demise can ensure your assets are assigned accordingly. Even if you don’t have much wealth, having an experienced lawyer to oversee your wishes is essential. Our lawyers at Norman Matter are very skilled and can help you secure your future.
Thanks to our experience and versatility, clients trust us and consult with us no matter the issue. Be it civil, criminal, or family disputes. Our services are open to anyone who needs them; contact us today to establish your estate plan or legal services.