5 Facts about Estate Planning
It’s a common misconception that estate planning is only for the wealthy. The fact is, everyone needs an estate plan. Here are the main points you need to consider when working with someone to create your estate plan.
1. Everyone needs an estate plan regardless of net worth.
Some people discount the need for an estate plan because they don’t believe their estate requires it. The amount of assets doesn’t matter. In the absence of a good estate plan, dissension and controversy can often revolve around personal items or a family heirloom. The main reason for planning is to protect beneficiaries. If someone has minor children, it is necessary to name a guardian. It may also be necessary to protect adult beneficiaries from bad decisions, outside influences, creditor problems and divorcing spouses.
2. The state already has a plan for you.
If you die without a will, the laws of the state where you live (intestacy laws) will dictate who will inherit your probate estate and how much they’ll inherit.
3. A good estate plan considers morbidity as well as mortality, and therefore more than just a Last Will and Testament is needed.
Most people tend to think of their estate plan in terms of what happens when they die. But it is also important to plan for what happens if or when you become incapacitated or lose the ability to protect yourself physically and financially before death. Durable Power of Attorney for Healthcare and a Durable Power of Attorney for Finance documents appoint someone to make decisions for you if you are incapable.
4. How assets are titled is an essential part of estate planning.
Estate planning begins with the necessity of taking an inventory of how assets are titled. Your wishes may not be carried out because of the way an asset is titled or by a beneficiary designation that causes the asset to bypass your estate plan.
5. Your Last Will and Testament could leave unintentional conflicts without careful consideration.
Making decisions about how assets are to be divided and distributed among spouses, family members and others is important. Another source of conflict can be who is named to serve as the Executor or Trustee of the assets. Many estates prefer to use a third party corporate executor and trustee, such as Pinnacle Trust.
For detailed information on each of these points, listen to the podcast below.
You can reach Keith at 615-743-6059 or by e-mail at firstname.lastname@example.org.
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