No one likes to think of a time when they’re not alive let alone make plans for where to send their assets and who will care for their loved ones. A vast majority of Americans do not have wills or any plans for their wishes at the end of life. A recent survey of US families during Covid exposed the refusal of Americans to avoid their mortality, and it highlighted that 68% of Americans have not created a will. It’s understandable that people want to avoid the conversation, but it’s not really a topic that families can afford to continue ignoring. By refusing basic estate planning, many families are wasting money that could be going directly to loved ones.
It’s a misperception that only rich people create living wills, trusts, or powers of attorney. The usefulness of these documents has more to do with the makeup of your family, the age of your children, and the decisions you’d like to make known to your loved ones after you’re gone. For families who are still not sure whether they need an estate plan, here are a few reasons why you may want to reconsider how your family may benefit from sitting down with a family lawyer and discussing your options.
4 Reasons Why Estate Planning Is Important for Your Family
Estate planning is important to all families, regardless of age or makeup. If you have any wishes about property or custody, you will need to outline your wishes in a legal document. Estate planning is more than a simple will, it’s a collection of documents that fully outline your wishes if you should become unable to voice them for yourself. An estate plan can also prevent your heirs from paying higher than necessary taxes on any property you plan to pass on to them.
These are just a few of the reasons you may want to consider an estate plan:
Protecting Your Beneficiaries: An estate plan is what’s best for your heirs or beneficiaries. A common misperception is that you have to be wealthy to need an estate plan. If you own a house, cars, a retirement account, any of the things that average middle class families have, you may need to create a plan for what will happen to these assets once you’re gone. An estate plan can also protect your spouse if you are the sole provider of your family income. If you don’t have a will or estate plan, the court will decide who should receive your assets, and the surviving spouse isn’t always guaranteed to inherit the estate. A plan will also protect your assets from being used to pay for fees instead of being used to serve your family and heirs.
Protecting Your Minor Children: Minor children are a primary concern for parents who finally make an estate plan. No one wants to think about dying while their children are young, but it’s an important event to prepare for just in case it does happen. You want to ensure your children are cared for in a way that you would if you were there, and that requires naming guardians and outlining your wishes in writing. If you don’t have a will that names the guardians of your minor children, the court will decide for you.
Protecting Your Family from a Tax Bill: You didn’t work and build assets just to leave them for the IRS to take. The heirs to your estate may be forced to pay hefty inheritance taxes depending on the size and makeup of your portfolio and assets. The amount due can be reduced by transferring asset in a manner that creates the smallest tax liability.
Protecting Your Family from Arguments and Strife: An estate plan could help to eliminate any fallout or animosity from family members unhappy with your wishes. Early knowledge of your plans can also help to soften the blow. You can also use your estate plan to choose who you would like to control your assets should you become incapacitated and unable to make choices for yourself. It’s best to leave your wishes clearly expressed. If you don’t, it could lead to your family fighting over who knows what’s best for you.
Palmer Rodak & Associates can help create an estate plan that clearly outlines your wishes. Call us today at (760) 573-2223 to schedule a consultation.