5 Steps for Proper Estate Planning
More than half of all Americans lack proper estate planning.
Estate Planning Just Can’t Wait
We get it, Estate Planning is scary. Creating what is known as an estate plan is a very important aspect of everyone’s life that they will need to undertake at some point. Not only will it give you peace of mind, it will allow those you leave behind to know for sure what your final wishes are so they aren’t left guessing in a time of grief and heartache. Beyond knowing your final wishes, it will also allow your assets to be distributed according to your wishes upon your death. Regardless of how important this process is, significant numbers of people do not have an estate plan, often making excuses about why they don’t need thinks like a will, a power of attorney and a healthcare directive.
One of the biggest excuses people have for not having a plan in place is thinking that they don’t have enough money, assets and prized personal belongings to warrant that kind of planning. Even if you all you have is the roof over your head and the clothes on your back, you still need a power of attorney or health care directive so that your loved ones are able to make the kinds of healthcare and financial decisions you would want in the event you are unable to do so yourself.
Another excuse people make is the belief that having a joint bank account with your children or others is a good means of transferring that particular asset upon your passing. The cold hard truth of that is, unless you only have one child you will have a very difficult time separating accounts equally for your children. This can leave hurt feelings amongst your heirs and even more trouble in life if you are incapacitated and unable to manage your finances.
Another reason people don’t have an estate plan is that they believe that it simply costs too much. The truth of the matter is, nothing is potentially more expensive than dying without a will. The attorneys at Harmon and Gorove offer a free, no pressure consultation to help clients understand how important and how easy it is to implement a proper estate plan. Our fees are among the most competitive, at times, even less expensive than online tools you pay for. Furthermore, the filing fees at probate courts are usually minimal and only enough to keep the programs running in the future.
Finally, most people simply state that they just haven’t gotten around to is and one day they will get it done. Believe me, we understand. One our own attorneys put off proper estate planning until the death of a loved one prompted them to take action. It NEVER pays to wait around, especially with something as important as your estate planning. Your estate plan allows loved ones to make decisions with peace of mind, knowing your wishes and desires. It also allows you to distribute your assets in ways that you deem fit, making sure that only those you deem worth inherit your most prized possessions.
Considering the consequences of not having an estate plan for our loved ones should we pass before making these plans should provide more than enough motivation to take the first steps of implementing an effective and meaningful plan. The attorneys at Harmon and Gorove understand how hard it is to make that first step. We want you to feel comfortable and understand what your options are. Contact us today to schedule a free consultation where we can discuss your estate planning goals.
Three Parts of a Basic Estate Plan
Every person, no matter how significant they may feel their assets are, absolutely needs to have a well thought out estate plan that covers three very basic documents that will serve your best interests and make the lives of those you care about that much easier when the time comes. The three main planning instruments you should have include a durable power of attorney, a health care directive, and a last will and testament. These instruments will cover an array of subjects in our lives and our family’s lives after we pass away and should be taken very seriously, regardless of what you believe you may leave behind.
Power of Attorney
The first thing you need to include in your estate plan will be a power of attorney. This allows you to designate a person of your choosing to manage your property, assets, and finances during your life in the event you are incapacitated and unable to act in your own interest. A power of attorney carries a lot of weight and gives someone almost complete control of your financial life and should be vested in a trusted individual you can be sure will act solely in your best interest should a time come where you can’t handle these situations yourself.
Healthcare Directive
The second thing you should look into is a health care directive. A healthcare directive is essentially a type of a power of attorney that deals only with health care decisions. A healthcare directive allows you to appoint a trusted person to direct your medical care and make important end of life decisions should you be unable to.
Last Will and Testament
The third and most essential piece of estate planning is your last will and testament. A last will and testament is the most basic mechanism used to transfer property to family and friends upon our death. There are numerous other ways to pass along our assets and other parts of our estates, including various forms of trusts, a last will and testament is still necessary to direct our loved ones whom we leave behind about our final wishes including whether we wish to be buried, cremated or shot off into space, types of memorial services and other ways in which we want to be remembered.
It is important to understand that these are just the essentials of an estate plan and what you will ultimately need will vary depending on what your leave behind and who you wish to leave it to. Significant assets like large bank and investments accounts, your home or other real estate assets, your business, and other valuables like expensive jewelry or art may need even more extensive estate planning that satisfies everything from family dynamics and business partners to tax and legal considerations.
If you find that your basic estate planning is not where you want it to be, schedule a no pressure, complimentary consultation with one of our attorneys today so we can go over your wishes and create a basic estate plan that will leave you with peace of mind and your family with valuable information about your wants and desires when the unthinkable happens.
Don’t Make and Estate Planning Mistake
In life, it’s easy to make a mistake. Estate planning is one of the most important things you can do in life. It should be taken very seriously in order to avoid hassles or other delays that can come when you probate your will and begin transferring assets to family and friends. With the correct planning, most people are able to avoid the costly mistakes that can lead to a prolonged and painful probate battle.
One of the most common estate planning mistakes you can make is adding a friend or young family member’s name to a joint account. You may think that it will make it easier to transfer assets or even pay final expenses. Often that isn’t true. It can cause confusion about your intentions once you pass and can complicate the probate process. It could also open you up to potential unscrupulous conduct by those you put on your account. The better alternative would be to give a trusted person a power of attorney to make financial decisions on your behalf in the event that you are unable to.
Another common mistake is not updating beneficiaries. By having the wrong beneficiaries listed on bank accounts, life insurance policies and retirement accounts you can prevent your assets from being transferred to your intended beneficiaries. Often, individuals will create a single will and never bother with updating it when major life events happen like having children or grandchildren, divorcing or remarrying or the death of a loved one. If you don’t update your will when these types of things happen your estate could essentially become intestate and you could be setting your heir up for a legal fight or a situation where the state itself decides what happens to your assets.
Out of all the mistakes listed above, the biggest mistake is having no plan at all. Yes, there are legal mechanisms that will provide for your surviving spouse and your children and grandchildren but the state can’t possibly understand all your wishes and what you wanted may ultimately not happen. Estate planning is essential to your piece of mind and also to those family members and friends who will survive you. If your estate plan is lacking, contact the caring and competent attorneys at Harmon and Gorove today for a free consultation about what your estate planning options are.