Although everyone is aware that they are going to die, statistics show that very few of us plan for death by preparing a will, trust or estate plan. According to a study conducted in 2010 by Forbes.com® about 65% of Americans do not have a will?
Often times we hear, “I don’t have enough money to worry about it, I trust xyz person to take care of it, it is too complicated or expensive, etc.” Then there are those people who sincerely believe that if they make a Will they may die.
The primary goal of estate planning is to protect, preserve and manage your estate when you die or if you become disabled. Some people may see no need for estate planning until they reach a certain age, or they might believe that it’s only for the wealthy. But in truth, it’s wise for everyone to begin the estate planning process as early as possible.
Why is estate planning so important? Because it allows you to accomplish a number of crucial objectives:
- Help ensure that your money and other assets go to the people you choose. Without a plan, state laws will determine your beneficiaries.
- Defuse potential conflicts over the distribution of your assets.
- Minimize estate taxes and other transfer taxes.
- Avoid the costs, publicity and delays of probate, the legal process used to value your estate, settle any debts, pay taxes and transfer assets to your heirs.
- Help ensure that you and your affairs are taken care of in the manner you wish if you should become incapacitated.
- For parents of minor children, the only place to name Guardians for your children upon your death in is your Will. Whatever reason you have for not thinking you need a Will, it is superseded by your need as a parent to provide for who will care for your children in the event of your death.
For those of you who have a will, there is no time like the present to review it. If any significant changes have occurred since you last executed your will, it needs to be updated. These changes might include:
- Birth or adoption of other children/ New step children as family members
- The death of any intended beneficiaries, guardians, trustees or executors
- Change of any intended beneficiaries, guardians, trustees or executors
- Marriage, divorce, separation or remarriage
- Death of spouse or children
- Inheritance of property or money
- Purchase or disposal of substantially valued property or valuable personal effects
- Significant increase in salary
- Purchase, sale or transfer of ownership of a company
- Significant change in estate size due to savings and growth components of your personal financial portfolio
- Change in desired method of distribution of estate to beneficiaries
- Law changes
- Desire to change elements of:
- Durable Power of Attorney
- Medical Directives
- Living Wills
Though planning for one’s own demise may feel morbid, you don’t want to procrastinate. Remember, if you don’t put your own estate plan into action, the government will do it for you. Do your loved ones a favor and get started now.