With inflation increasing by 6.5 percent in 2022 and the cost of necessities like fuel increasing by a staggering 42 percent, financial planning is more important than ever.
While most Americans plan for retirement, many neglect another crucial aspect of financial planning – end of life or estate planning. Although about six in 10 Americans have a retirement account, only one in three have an estate plan according to Caring.com’s 2023 Wills and Estate Planning Study. While this shift is encouraging, estate planning is vital for everyone, regardless of age, wealth, marital status or parental status.
Incapacity Protection: Planning for the unexpected estate planning is not just about preparing for death; it is equally crucial to address the possibility of incapacity due to accidents or illnesses. Without an estate plan, your family may need to go to court to appoint a guardian or conservator to make decisions on your behalf. This process can be expensive, time-consuming and emotionally taxing. By consulting with an attorney, you can create documents that grant someone you trust immediate authority to manage your medical, financial, and legal affairs in the event of your incapacity.
Controlling Your Legacy: Dying without an estate plan leaves the court to determine how your assets will be distributed, often following state intestate succession laws. These laws prioritize blood relatives, potentially excluding unmarried partners and close friends. With an estate plan in place, you ensure your wishes are honored and your assets are distributed according to your wishes, regardless of family ties. Moreover, it allows you to address complex family dynamics, such as providing for children from previous relationships or safeguarding assets for young beneficiaries.
Avoiding Probate and Conflict: Failing to create an estate plan forces your family to go through probate—a slow, costly, and public court process. Probate can take months or years, deplete assets and lead to family conflicts. However, proper planning using a trust can help assets pass directly to your family without court intervention, providing privacy and saving time and money.
Minimizing the Mess: By neglecting estate planning, you leave your loved ones with the burden of dealing with your affairs. From managing your belongings to accessing accounts, the process can be overwhelming. A properly drafted estate plan offers clear instructions, reducing stress and simplifying matters for your family in difficult times and it makes it easier for your loved ones.
Guardian Designations: For parents of minor children, the most pressing concern is who will care for their kids in case of death or incapacity. Without a proper estate plan, a judge will decide, potentially causing heartbreak and family disputes. By naming legal guardians in your plan, you provide clear direction for the court, ensuring your children are raised by someone you trust. You ensure that your children are raised by the people you trust that protect your children’s well-being.
Though some may still dismiss estate planning as unimportant, the consequences of not having a plan can be devastating for you and your loved ones. From incapacity protection to legacy control and family well-being, estate planning offers peace of mind and ensures your wishes are carried out. Regardless of your age, consider consulting an attorney to get started on your estate plan and secure a brighter future for yourself and your family.
This article is provided by your local estate planning Attorney, Corina Colan.
The Law Office of Corina I. Colan| (909) 265-3315 | [email protected] | www.colanlegal.com