When it comes to estate planning, you may think that you don’t have the wealth that would require you to engage in extensive estate planning. If you have a will, you might think that’s good enough. Forbes’ recent article, “Why Estate Planners Aren’t Just for the Ultra-Rich,” says that nothing could be further from the truth.
Although some estate plans are more complicated than others, just about everyone can benefit from having one. Let’s examine the main reasons why:
Avoiding probate. This is a big reason why the importance of estate planning is for everyone. You don’t have to be part of the 1% to want to avoid putting your family through the stress and expense of probate. Creating a trust and strategically placing assets within its control, eliminates many headaches.
Naming a Guardian for Your Children. Naming a Guardian for your children can only be done through estate planning documents. In most states a will is the only document where you can legally name a guardian to raise your children. If your estate planning documents don’t name a Guardian, the courts will name on for you, and it may not be the person you would have chosen.
Protecting your legacy. When you consider leaving a legacy for the next generation, it may have lofty pursuits. However, those aren’t necessarily reasonable goals for everyone. Leaving a legacy can also mean making certain that heirs properly respect all the effort and sacrifice that it took to save and create a retirement fund—whatever its size.
Creating a business succession plan. Among the countless small businesses in the U.S., most will continue to remain viable after the legacy owner dies. A business owner can plan for this within an estate plan, which details exactly what they want to happen, if they die unexpectedly. That could include outlining specific roles and responsibilities for surviving heirs or putting into place a buy-sell agreement with a business partner and directing the distribution the proceeds of the sale.
Be sure to revisit your estate plan regularly, especially if your life includes big events, like a birth of a child, a divorce, or an irreconcilable difference with a loved one.
It’s a myth that estate planning is something only wealthy people do. The middle class need estate planning too. It’s for everyone.
Reference: Forbes (April 15, 2019) “Why Estate Planners Aren’t Just For The Ultra-Rich”