What is Estate Planning?

Estate planning is a roadmap for your financial and physical assets and what will happen to them after your death. It is typically implemented with the assistance of a lawyer and often includes documents like a will, a trust, or durable power of attorney.

Why is estate planning important?

Estate planning is important for everyone to ensure that your assets go to the people you love and care about. Without a plan, everything you have worked your entire life to build may end up in the wrong hands or be subject to significantly more interference from outside sources. This blog will discuss more in-depth reasons why estate planning is necessary for everyone, regardless of age, wealth, or status.

Protecting the Important People in Your Life with An Estate Plan

Rarely the average person doesn’t have any form of an estate they would be leaving behind when they pass away. Almost everyone has a home, a child, investments, life insurance, a savings account, a car, or other estate they will leave behind. These are all valuable assets that represent important aspects of your life. When planning to distribute your estate, it’s crucial to contemplate each item. They reflect your hard work, accomplishments, and the legacy you wish to leave behind.

How will this affect my family?

  • Guardianship: If you are a parent or caretaker, having a plan for your children is one of the most crucial parts of an estate plan. We never know what will happen, so ensuring your minor children or other dependents are well taken care of by someone you trust is one of the best things you can do for them beyond the grave.
  • Financial Security: If you can provide financially for your family, this is another vital aspect to consider in estate planning. Making sure their needs are met, having a plan for keeping their lifestyle the same as they learn to cope with life without you, and protecting them against the uncertainty of the future all give you peace of mind that they will be okay.
  • Vulnerable Family Members: Your plan should especially include family members who are old or have special needs. Often, long-term care is needed to support them fully, which will likely require you to plan for long-term financial assistance.

Planning for A Medical Emergency

As much as we would like to tell you what will happen in the future, we can’t. Events like medical emergencies, car crashes, and sudden deaths happen every day around the world, regardless of age. Without an estate plan, you could leave essential decisions like the type of care you receive up to people who don’t have your best interests in mind.

Why is this important?

  • Medical Decisions: Estate planning involves not only what happens to your estate but can also include what happens to you if you cannot decide for yourself. You must have a plan set in place for your medical preferences should you be incapacitated during your lifetime. Having a living will or a power of attorney in place with your best interests in mind can make all the difference in difficult situations.

Minimizing Conflict, Maximizing Care

As the saying goes, weddings and funerals bring out the worst in people. But it doesn’t always have to be that way! Estate planning combats the stress and chaos that comes with death. It’s one of the best ways to show your family how much you care about their future. We work with you and the law to trust everyone is on the same page when that time comes.

Why is this important?

  • Clear Instructions: As we mentioned, getting everyone on board is essential but can be challenging. Emotions are often high in these situations, and everyone has their own opinion on the best way to handle your estate, which will likely cause butting of heads. With a laid-out estate plan, we can avoid sticky situations that cause tension when making final estate decisions.
  • Preventing Probate Court: With an estate plan in place, you can eliminate the hassle of probate court, as everything has already been decided. Estate planning can save your family thousands of dollars in court costs and prevent your loved ones from enduring the lengthy court process to determine what happens with your estate. Estate planning also lets you keep your life’s intimate details private. If your family must go to probate court because there was no plan in place, the case will then become a part of the public record for the world to view. If you or anyone in your life is exceptionally private, this can comfort them in an already trying time. 

Tax Planning, Assets, and a Trust

There are many legal consequences to not having an estate plan in place. Tax planning is an essential step in estate planning to ensure your family doesn’t spend your wealth on creditors who claim you owe them money.

Why is this important?

  • Wealth and Taxes: With estate planning, it is possible to have a tax plan in place.  Because of this, your family will likely pay a considerable amount of taxes to the government. Estate tax, probate tax, income tax, and state tax are just a few types of taxes your family could endure. However, when you plan accordingly, this burden can be reduced by using tax-efficient strategies to help save your wealth and estate for its intended purpose.
  • Protection: If you have a significant amount of debt, this is another factor to consider in your planning process. Without estate planning, protecting your estate from being seized or liquidated by creditors to fulfill your debt is a genuine possibility. Similarly, questions in ownership, disruption of operation, and other legal challenges can be imminent for a family business.

Respecting Your Final Wishes

A large part of estate planning is respecting your wishes regarding the disposition of your wealth. Many of our wealthy clients dedicate their lives to building a legacy they can leave behind, and safeguarding that legacy is our responsibility.

Why is this important?

  • Individualized Solutions: Our specialty is creating a plan specific to your family dynamics that reflects your character, values, and beliefs. No one person or family is the same, so being creative in our planning process while also working within the law is crucial to our client’s satisfaction.
  • End-of-Life Planning: Everyone should have a plan in place for their funeral. This relieves your family from making decisions you may disagree with and lessens the decision-making and financial burden during a traumatic stage of life.
  • Charity: It’s very common for folks to include charitable donations in their estate planning process. This is another way to plan to make a difference by supporting causes that are near and dear to your heart. Sometimes, this is the only legacy people leave behind for the world and an admirable one at that!
  • Flexibility: Your estate planning changes throughout life. What was once a plan for your minor children may now be a plan for grandchildren. Or maybe the plan you made for your funeral a decade ago no longer aligns with the care you wish to have in your final days. This is why flexibility in your planning process throughout the years is imperative as your life changes.