5 Reasons To Start Your Estate Plan Now
Generally speaking, estate planning isn’t only reserved for rich people. Regardless of their personal and financial circumstances, anyone, including you, can benefit from an estate plan. In essence, an estate plan refers to an official document that provides information about how and to whom your assets should be distributed when you die or become incapacitated.
If you haven’t developed an estate plan yet, below are five of the reasons you should do so now:
- Ensure Your Loved Ones’ Financial Future
One of the common reasons for making an estate plan is to protect your loved ones’ financial future. Since life is filled with many uncertainties, you need estate planning to provide for them when you pass away or end up with a debilitating condition.
With an estate plan, you can make informed decisions about who’ll administer your assets and receive specific properties and who you’d want to take care of your children should something unfortunate happen to you.
Thus, if you want to secure your loved ones’ financial future against uncertainty, drafting your estate plan now can be one of the best decisions you’ll make in life. With a plan, you can rest easy knowing your loved ones will receive everything you’ve worked for throughout the years. However, if you don’t know where and how to start an estate plan, a lawyer from reliable online law firms like https://weinerlegacylaw.com/ would be able to help you.
- Avoid Probate
Without an estate plan, you may be leaving all your assets to the state, which will then determine the recipients of your estate. When this happens, your estate will undergo probate, which can be a costly, lengthy, and time-consuming process. This is one of the reasons you should start working on your estate plan.
Building an estate plan would involve adding beneficiary designations and setting up a trust. When you have these strategies in place, you can avoid probate because all of your assets are already placed and distributed to the trust through the trustee. The trustee, on the other hand, will manage the properties for the benefit of your beneficiaries.
- Minimize Estate Taxes
The absence of an estate plan can result in the payment of hefty state inheritance taxes. These tax obligations can cause a financial strain as they tend to reduce your estate’s overall value. Because of this, going through estate planning can be a good option.
For example, setting up trusts as part of your estate plan can decrease or even eliminate estate taxes. When you transfer some of your assets to a trust, you can reduce the size of your taxable estate, thereby diminishing the overall tax liabilities.
Aside from trusts, many estate planning techniques can help mitigate the potential tax consequences. It’ll help if you hire an estate planning lawyer or financial advisor to help you assess which methods would work best for your situation.
- Protect Assets Against Lawsuits
Another reason for creating an estate plan is to shield your assets against lawsuits. It would be too late to start estate planning for asset protection when someone has already sued you for failure to meet a monetary obligation. As a result, your wealth will be exposed to lawsuits.
Therefore, it’s best to start your estate plan early if you don’t want that to happen. With it, you can choose which asset protection strategies are suitable to safeguard your assets in the long run. For example, you can include in your estate plan some techniques such as setting up a trust, forming a limited liability corporation (LLC), and buying insurance policies. These methods are designed to protect everything you own if a lawsuit and any other risks arise along the way.
- Avoid Family Fights
Your failure to establish an estate plan may result in family fights when you pass away or become incapacitated. Since you can’t designate someone to be in charge of your estate or determine who’ll get what and how and when they’ll get it, it can cause conflict among your loved ones.
However, if you have an estate plan, you can steer clear of family fights because everything’s in order. The person you designate to be in charge will administer and distribute your assets according to your express wishes.
Estate planning can be a complicated process. But despite the complexity involved, dealing with it as soon as possible can give you peace of mind in the long run. The earlier you make an estate plan, the more you and your family become ready for any challenging situation.
Therefore, if you want to make the right decisions for your and your family’s future, keep these reasons to start estate planning in mind. You can seek legal help from a lawyer to guide you through the process.