The following phrases might sound familiar to you. "I don't need an estate plan because I'm not rich." Another one is, "I don't want to bother with estate planning because my family will just figure things out once I'm gone." Finally, "I'm young and healthy, so estate planning is still decades away."
Are these phrases ones that you've said before, or at least thought about? There are a lot of misconceptions about estate planning, which is one reason why many people never bother to draft one. But if you have an estate (and every adult does), you need an estate plan.
"I don’t need an estate plan because I'm not rich"
Not true. Your estate is more than just your excess cash. It includes your:
- Real estate
- Retirement savings
- Insurance policies
- Personal belongings
- Certain debts
No matter how modest your estate may be, you need a plan for it.
"My family will figure things out when I'm gone"
This is a risk that no one should be taking. If you don't have a will and an appointed executor, your family may have very little control over how your property and assets are distributed. Those who die "intestate" (without a will) are essentially giving decision-making authority to the state they lived in.
Moreover, family members are not always as cooperative as we would like them to be, especially while grieving. Even when an estate plan is in place, any vague language or unclear instructions could lead to family disputes that occur both in and out of court. Therefore, leaving details up to your family could create more confusion, friction and higher costs than just making the arrangements yourself.
"I'm young and healthy, so I can put off estate planning"
None of knows how much time we have left. And estate planning serves different purposes at different points in life. Do you have a custody plan for your minor children in case the unthinkable should happen?
Each of has an estate, so each of us needs an estate plan. One of the best things you can do for yourself and those you love is to have that plan in place as soon as possible.
Source: The Auburn Citizen, "Carr: Why you need an estate plan," Timothy Carr, Feb. 12, 2015