The terms “estate plan” or “trust funding” are typically associated with wealthy families that own large homes and larger stock portfolios. The reality, however, is that estate planning is not just for the super wealthy. In fact, estate planning is an important part of anyone’s personal and financial plan, regardless of wealth or age.
So, why is it important to have an estate plan?
Each state has its own laws regarding how a person’s assets are distributed after their death. Still, it is often the case that a decedent’s family must go through the courts to gain access to their assets. Court proceedings are time consuming and likely will not have the same outcome as the decedent may have wanted for their family. Creating an estate plan provides the ability to be clear about how to distribute assets, finances, and personal belongings.
There are a variety of options when it comes to creating your estate plan. While trusts are not the only type of option, for many people it is the best course of action to best protect their assets. Estate plans typically include a durable power of attorney, a healthcare proxy, HIPAA authorizations, and a living will. These documents authorize a person of your choosing to make medical and financial decisions should you become unable to do so. Without such documents, the courts may become involved to appoint a legal guardian.
Having an estate plan also does not necessarily mean that nothing will change. We advise that our clients review their estate plans every three at least and when there has been a major life change.
What are some of the most common reasons to review your estate?
- Is there a new member of the family that you want to add to your estate plan?
- Is there someone you want to remove from the estate plan?
- Have you received an inheritance?
- Are there new tax laws in place?
- Are they any changes in your health?
- Have you recently gotten married or divorced?
Creating an estate plan with the right attorney is a worthwhile investment for the future.