Effective estate planning is sometimes overlooked by many individuals, even those who are proficient at managing their current finances. If you have never thought about completing this task, you are inadvertently making your loved ones vulnerable to negative circumstances in the event of your death. Although proper estate planning takes time and effort, the latter is minimal when compared with the more time-consuming and potentially costly situation your loved ones may find themselves in once you are gone. For this reason, hiring an estate planning attorney to complete this task should be a priority in your life.
Avoiding Unnecessary Problems
Should you pass away without an estate plan, your heirs must attempt to reach a mutual decision concerning who gets your property and other assets. In addition, your estate will almost certainly go to probate court, where these decisions are ultimately made by a judge, leading to additional fees or even a long and complicated probate. This means that your heirs receive less of your estate than you would have designated if an appropriate plan had been drawn up by an attorney. Also included in a proper estate plan is a designated individual who is given power of attorney in the event you become injured or otherwise incapacitated. This is certainly something you do not want left to chance.
The Danger of Making Assumptions
You may also be surprised to discover that courts do not automatically rule in the manner many people assume they do, such as awarding everything to the surviving spouse. Similarly, you may assume that children always go to the nearest living relative, but this is not always the case either. Therefore, to avoid having these decisions made by a judge who is a perfect stranger, it is important to make them yourself while you are still able.
The primary purpose of estate planning is to designate heirs for your assets, but it is this term that often confuses people. Some individuals believe the word “assets” refers to large bank accounts, expansive investment portfolios, or multiple properties. In reality, however, whether you have a stock portfolio and a beachfront home or a small bank account and a modest retirement fund, it is vital to have an estate plan in place. Do not make the mistake of thinking that there is no need for such a plan simply because you are young or you do not have substantial net worth. Even if your net worth is modest, you do not want the assets you do have going to a person for whom they were never intended.
It may feel as if you have your entire life to ensure that an estate plan is in place that explicitly spells out your wishes in the event of your death; however, no one ever knows when he or she is going to pass away and sudden deaths are not as uncommon as people may think. After your death, you no longer have a say regarding how your assets are distributed. The only way to control what happens after you are gone is to contact an estate planning attorney and make sure that the appropriate documents are in place ahead of time.