Believe it or not, we all have an estate.
When we hear estate planning, many of us automatically draw a blank, we may assume this does not apply to us or that we have no estate to plan around. One common myth, particularly in immigrant and low income communities is that estate planning is only for the wealthy. Some cultures might even find it strange or bad karma to plan for one’s death, but if we carefully stop to think about it, most everyone has an estate or at the very minimum all of us share two things in common; a body and the reality that one day we will die. When that happens, you may want to ensure what will happen to your estate Therefore whether we believe it or not, however modest our means are, we all have an estate.
Despite this reality, estate planning is such an important and often overlooked tool many families take for granted. “While it is a common myth that estate planning is only for the wealthy, at LRYM we want to ensure that ALL families are protected and there is a plan in place to carry out your wishes in the event of an emergency.” We understand that our families are what matters most. Yet, many of us are unsure as to what we can do to look after them, we may buy a life insurance policy, but often neglect taking the necessary steps to ensure we know what is happening with our children when we die. Some of the questions estate planning can help answer are as follows:
- Who will take care of the children?
- Who will manage anything I leave behind for them?
- What will happen to my house, who will keep it?
- How will we pay for all of the funeral expenses?
- What were my loved ones’ wishes? What are my wishes?
- How will my children give me the best care possible if I am unable to speak for myself?
- What will happen to my body?
- What kind of care do I want to receive if I am hospitalized?
- How do I know my family will move forward when difficult times arise?
What is an Estate?
An estate is comprised of everything you own; personal possessions, bank accounts, money, investments, artwork, cars, furniture, jewelry, debts, and anything else you own at the time of death. A proper estate plan will make sure that your responsibilities do not become a burden on your family in the event of your mental or physical absence. An “estate plan” does more than guarantee property transfer, it provides a roadmap for loved ones and family so they are taken care of, and your wishes are honored. The estate plan answers questions like the ones listed above.
Why an Estate Plan? For parents of young children, the estate plan is key to ensuring those children will be taken care of and monetary assets are distributed responsibly. An estate plan establishes guardianship over children and points to those trusted people who will help make monetary decisions with what is left for them. For more mature families, an estate plan will protect your assets. Different estate planning documents minimize the amount of taxes paid when transferring property to loved ones, or safeguard retirement plans in order to fully utilize tax deferral. Other estate planning documents entrust those people who would make health care decisions in the event you could not communicate your intentions, or outline your wishes in regards to life-prolonging medical care.
What can an estate plan do for me?
An estate helps you ensure your wishes are carried out, you need to provide instructions stating whom you want to receive something of yours, what you want them to receive, and when they are to receive it. You will, of course, want this to happen with the least amount paid in taxes, legal fees, and court costs.
That is estate planning—making a plan in advance and naming whom you want to receive the things you own after you die. However, good estate planning is much more than that. It should also:
- Include instructions for passing your values (religion, education, hard work, etc.) in addition to your valuables.
- Include instructions for your care if you become disabled before you die.
- Name a guardian and an inheritance manager for minor children.
- Provide for family members with special needs without disrupting government benefits.
- Provide for loved ones who might be irresponsible with money or who may need future protection from creditors or divorce.
- Include life insurance to provide for your family at your death, disability income insurance to replace your income if you cannot work due to illness or injury, and long-term care insurance to help pay for your care in case of an extended illness or injury.
- Provide for the transfer of your business at your retirement, disability, or death.
- Minimize taxes, court costs, and unnecessary legal fees.
- Be an ongoing process, not a one-time event. Your plan should be reviewed and updated as your family and financial situations (and laws) change over your lifetime.
Estate planning does not have to be expensive.
If you don’t think you can afford a complex estate plan now, start with what you can afford. For a young family or single adult, that may mean a will, term life insurance, and powers of attorney for your assets and health care decisions. Then, let your planning develop and expand as your needs change and your financial situation improves. An experienced attorney will be able to provide critical guidance and peace of mind that your documents are prepared properly.
The best time to plan your estate is now.
None of us really likes to think about our own mortality or the possibility of being unable to make decisions for ourselves. This is exactly why so many families are caught off-guard and unprepared when incapacity or death does strike. Don’t wait. You can put something in place now and change it later…which is exactly the way estate planning should be done.
The best benefit is peace of mind.
Knowing you have a properly prepared plan in place – one that contains your instructions and will protect your family – will give you and your family peace of mind. This is one of the most thoughtful and considerate things you can do for yourself and for those you love.
To find out more about estate planning and how we can help you and your family be prepared, please call our office to setup a free consultation at 602-910-4040. We offer the following services:
- Estate Planning
- Durable Power of Attorney
- Health Care Power of Attorney
- Living Will (Final Directives)
- Trusts and Wills
- Notary Services