If you're like most people, you understand that estate planning is a good idea. You know that an estate plan ensures that your property goes to the right people and ensures your children are properly taken care of. Although you probably understand the importance of estate planning, you know it's all too easy to put off actually sitting down and making your plan.
If you can relate, then what better time then the New Year to resolve to actually finish your estate plan? While you may already have several New Year's resolutions swirling around in your head (or better yet already written down), a resolution to prepare your estate plan is a realistic goal that can be achieved by anyone.
So to further encourage you to make finishing your estate plan a goal for the New Year, let us offer five reasons why your estate plan should be done this year:
1. Your Property Will Go To The People You Want
Without an estate plan you do NOT get to decide where your property goes when you die. Instead, state law determines who gets what. This may be the number one reason to do your estate plan. Even if you are not wealthy, you can still prepare a simple will or living trust to ensure your property is transferred to the people you want.
2. Your Children Will Be Taken Care Of According To Your Wishes
If you have young children and die without an estate plan then state law also determines who is the personal guardian of your minor children and who is the financial manager of their inheritance. This is why you'll want to ensure that your children are taken care of according to your wishes. In your will, you can name guardians to raise your children and managers to look after their inheritance.
3. Your Medical And Financial Decisions Will Be Made By People You Trust
If you ever become incapacitated you will want to ensure the people you trust make important decisions for you instead of a court order or court appointed receiver. Part of estate planning is preparing for what would happen if you ever become unable to make medical and financial decisions for yourself. This can be done through a health care directive and a durable power of attorney. These documents can save your family much heartache.
4. You Will Save Time And Money By Avoiding Probate
Probate is the court process for wrapping up an estate. It's often time-consuming and expensive and rarely provides any benefit to the beneficiaries. With a little estate planning you can keep most or all of your estate out of probate, saving your loved ones time and money.
5. You May Reduce Your Estate Taxes
For the year 2017, if you pass away and your estate is worth more than $5,490,000 then your estate will be subject to federal estate taxes. If you already own this amount, or plan to eventually, then you will want to use your estate plan to reduce the tax that your estate could owe after your death.
Hopefully these five reasons encourage you to make estate planning part of your goals for the New Year. Estate planning may seem overwhelming and time-consuming but it does not have to be. Keep in mind that many people need only a simple estate plan. You may even be able to prepare all your documents yourself. Or you might discover that having a lawyer do all the work for you is easier. Either way, planning your estate is a worthwhile goal that you can achieve this year. To start, get a free consultation to discuss what is best for you.