Understanding the Importance of an Estate Plan
August 25, 2020
August 25, 2020
Most people would rather not discuss estate planning—after all, who wants to confront their own mortality? But putting it off can be a mistake, as it can lead to misunderstandings among family members, additional taxes as well as a host of other problems.
What is estate planning?
Estate planning is the process of creating a legal arrangement to manage, protect, and distribute your assets upon your death. An estate plan can also address the management of your affairs in the event you become unable to manage them yourself.
Why everyone needs an estate plan
The term “estate plan” makes you think of someone with deep pockets and vast holdings. However, virtually everyone has something that should be accounted for in a will, trust, or general assignment of assets.
If you do not have an estate plan, but have real property with a value greater than $55,425 or overall assets in excess of $166,250, the Court has to supervise the transfer of assets to your heirs in a process called probate.
The probate process can take anywhere from nine to 18 months and costs an average $10,000 for an estate valued at $250,000.
Additionally, estate planning goes beyond merely leaving your money or physical belongings—it can also help make sure all of your wishes are carried out as you intend, including important topics like who will care for your children or pets.
What is contained in an estate plan
An estate plan holds the key to where your family can find all your important documents, including financial records, such as bank accounts and retirement savings; titles to real estate, cars and other property; and insurance policies.
An estate planning professional can walk you through the process and paperwork to help you establish the following aspects of an estate plan:
Resolving conflicts as you create an estate plan
While one of the goals of an estate plan is to negate conflicts that might occur once you are gone, it can be intimidating to have conversations with loved ones regarding their role in your plan.
Estate planning professionals can help you navigate all of your options and even advise on tough conversations. Whether you are a dad who worries your son will never get a job if he receives a lump sum or a mom who does not think her in-laws are the ideal guardians for her children, estate planning professionals can help you approach these issues from an outside perspective.
The bottom line is there is more to estate planning than simply dividing your assets. Making a legally binding plan for your wishes and belongings can ease the burden on your family during a time that is already challenging.
Have questions about estate planning? Young Wooldridge, LLP, offers access to discounted estate planning services to everyone who banks with Valley Strong.