If you're like most people, you want to ensure that your family members and loved ones are well-cared-for should an accident or illness take you away from them.
You may also wish to decide now who will control your assets and who will make decisions regarding your healthcare should you become unable to make decisions yourself. All of these concerns can be addressed by estate planning strategies.
Although the foundation of any estate plan is typically a last will and testament, a comprehensive estate plan frequently includes more than just a will. Moreover, an estate plan can do much more than just provide instructions for the division of assets upon your death. In fact, estate planning offers you the ability to include incapacity planning, retirement planning, long-term healthcare planning and much more all in one plan.
Despite the fact that most people realize the importance of estate planning, over half of all Americans have yet to create a comprehensive estate plan. If you have yet to sit down and create your plan, we recommend that you consult with an experienced estate planning attorney as soon as possible. By doing so, you can rest easy knowing that your estate, your loved ones, and your own future are well protected.
FACT: Creating an estate plan typically takes about 4 hours of your time, depending on your estate complexity. In comparison, the average American watches over 15 hours of TV every week!
9 Reasons Investors Avoid Comprehensive Estate Planning
1. “My heirs will inherit everything I own anyway.” Though state intestacy laws will provide for the distribution of your assets in the absence of an estate plan, your friends, charities, and more distant relatives will receive nothing. Moreover, your estate could spend months, even years, in probate before your assets are released, costing your heirs both time and money.
2. “I don’t know where to start.” The apparent complexity of the estate planning process can be intimidating and prevent an individual from taking the first step toward plan creation. Consulting with an estate planning attorney and your family wealth advisors can alleviate many of the fears and confusion surrounding estate planning.
3. “I don’t have enough assets to bother.” People are often under the mistaken assumption that only the wealthy need an estate plan. The truth is -- given the diverse goals an estate plan can accomplish -- everyone needs a plan, regardless of their wealth or lack thereof.
4. “I don’t need an estate plan until I’m older.” Another common misperception is that an estate plan is not necessary until later in life. The truth is that death or incapacity can strike at any moment, meaning that an estate plan could be put into practice tomorrow.
5. “I’ll get around to it eventually.” Basic procrastination often causes people to put off creating a plan because it doesn’t seem like a priority. If your loved ones are a priority, then estate planning should be.
6. “I already have one.” Once you create an estate plan, do not make the mistake of failing to update the plan. An estate plan should be reviewed every three to five years and when life events, such as marriage, divorce, or birth, dictate a review.
7. “Thinking about my own death is depressing.” The young assume they will live forever and the elderly don’t want to dwell on the inevitable. It is important to remember, however, that creating an estate plan doesn’t need to revolve around your death. Instead, your estate plan may include investment planning, retirement planning, and incapacity planning as well.
8. “My spouse/partner/child/parent will automatically be able to make decisions for me.” You may be under the impression that the person whom you would choose to make end-of-life decisions for you will automatically be allowed to do so. This is not necessarily true. In fact, a court may end up deciding who will make those decisions after a protracted and divisive family battle if you fail to create an estate plan.
9. “I can’t afford an estate plan.” Simply put – you can’t afford not to have an estate plan. The money you spend now on the creation of an estate plan will likely save you, your estate, and your loved ones considerably more down the road.
Source: The Care Solution, September 8, 2011, by Lauren Reynolds