It seems like the majority of people dedicate more time to planning a vacation or where to eat dinner than they do decide who will inherit their estate. Sure, estate planning isn’t as fun as booking a trip or checking out reviews of different restaurants, but without it, you can’t choose who gets everything that you worked hard for.
Estate planning is not only for the upper class. Without a plan in place, there could be an impact on your loved ones for a very long time. An estate plan can save your loved ones from this problem when you are gone. Even if you don’t have a pricey home, large investment account or valuable art to pass on. It can help many other ways. Not convinced that you need an estate planning lawyer? Consider these three reasons why you should have an estate plan, in order to avoid potentially devastating consequences.
- Protects Families With Young Children
Nobody thinks of dying young. However, if you’re the parent of small children, you need to prepare for the unthinkable as no one knows when it is coming. This is where the will portion of an estate plan comes in. To ensure that your children are taken care of, in a manner that you approve of, you’ll want to name their guardians in the event when both parents die before the children turn 18 years old. Without such a will in place, the courts will again step in and this time it’s not to determine who gets a piece of real estate or an artwork, it’s who will be responsible for raising your own children.
- Avoid High Death Taxes
With the larger federal estate tax exemption in place, most families will not have to pay federal estate tax. However, many states have their own inheritance/death tax and while the state’s tax rates are generally lower than the federal tax rate of 40%, they typically apply at a much lower threshold. This means an estate could be exempted from federal tax but have to pay a state tax. Proper estate planning with an experienced estate planning lawyer can reduce or even eliminate state inheritance/death taxes.
- Eliminates Family Messes When You’re Gone
We have all heard those stories that when someone with high net worth dies, the warring between family members begins. One sibling may think that he or she deserves more than another, or one sibling may think that she should be in charge of the finances even though she’s notorious for racking up debt. Such squabbling can get ugly and end up in a court, with family members pitted against each other. It’s yet another reason why estate planning with an experienced lawyer is necessary. This will enable you to choose who controls your finances and assets if you become mentally incapacitated or after you die, and it will go a long way towards solving any family issue and ensuring that your assets are handled in a way that you approve of.
The Bottom Line
If you want your assets and your loved ones to be protected when you no longer can take care of them physically, you will need an estate planning lawyer. Without one, your heirs could face huge tax burdens and the courts could designate how your assets are divided, or even who gets your children. Estate planning implements successful succession hierarchy.