Estate Planning Myth #5: I have a will, and that's enough
Yes, yes, I know–I have touched upon this topic quite a few times. Precisely, though, it’s going around a lot, and I just can’t not include in the series this very popular estate planning misconception:
“I have a will, and that’s enough.”
Nope, it’s not! While I have to admit that having a will is a step toward fully preparing for the future, it is but a step. In other words, there are many other things that you can do now to ensure that your desires are carried out even if at that time, you are no longer able to communicate these preferences to your loved ones.
If you already have a will prepared, good for you! It’s an excellent way to show you care about your loved ones, their security, and their protection.
A will can be great for many things if drafted correctly. For example:
Nominating guardians for any minor children after your death
Nominating caregivers for any pets after your death
Providing for charities or causes you support
Designating where any remaining property should go
But you may recall that we've been talking a bit about many other planning tools, and these are important--in fact, essential--for closing the gaps. How? Here's a few.
GAP #1 - Planning for Emergencies During Your Life
"Estate planning" isn't just for after you pass away. An important part of the work I do is helping families prepare for how things will be handled in the event of an emergency or incapacity (that is, if you are not able to act on your own or make decisions). For example, do you have someone who can legally act on your behalf for financial or medical decision
making? (Thinking your spouse can do this without any added paperwork?! Sometimes yes, sometimes no. It's not a fun place to get stuck)
And if you have minor children, planning for temporary guardianship is VITAL. Enough said.
GAP #2 - Protecting Inheritance
What if you don't want your kids to inherit a giant chunk of cash the moment they turn 18? (Um, I won't share the extent of MY bad decision-making at 18. I'm sure many of you have similar experiences.) Under most wills, your kids are going to get their inheritance directly--and if they're a minor when you pass away, they'll get it when they turn 18. Leaving life insurance? Yep, same story.
Protecting inheritance can also be important when you have a child or other beneficiary with spending concerns, significant debt, potential lawsuits (including a divorce), or substance abuse, just to name a few.
Fortunately I know this awesome way (*cough, cough* revocable living trust) to set this up.
GAP #3 - Planning for End-of-Life
There are so many decisions that come with end-of-life care, and if you've ever been in this situation for a loved one, you know that emotions are high and decision-making is hard. These decisions can include nursing home care, hospice and palliative care, what life-prolonging procedures to continue or withdraw, pain management and quality of life concerns, and organ donation, among others.
By spelling all of these desires out in a living will, you are giving an amazing gift to your family. They'll breathe easier knowing that they're following your wishes, that they don't have to agonize over these decisions, and that they don't have to fight with others over what actions to take.
GAP #4 - Avoiding Probate
For many families, probate is something they'd like to avoid. It's a giant misconception that having a will allows you to avoid probate--it does not. A will must be probated. You can read more about it here, but here's the short version: probate is a legal process by which the court transfers your assets to your beneficiaries. It can be a time-consuming and expensive process in some cases, and it is completely public.
Luckily, there are some planning strategies that will allow you to bypass this procedure. If you are wanting to avoid probate, let's talk.
These documents I've mentioned above--Living will, power of attorney, trust agreement-– are some of the instruments that make up a comprehensive estate plan. They are just as important as your will. Not all of these tools deal with distribution of properties; some are intended to carry out your wishes with respect to the care and preservation of your assets, medical and non-medical related decisions, settlement of business transactions and such other important affairs. Go and click the links to learn more about each of these estate planning tools!
It's my goal to always offer a complete and unique plan for you and your family's needs. No two individuals will have identical situations, so talking with a knowledgeable estate planning attorney can help you identify the best strategy and documents for YOU.
Having a will IS a great start, but it may not be the whole picture. I'm here to help. Have some more questions on the matter?? I’m all ears!
Sign up here for an online consultation—casual, no pressure, and absolutely free!
You may also contact me by clicking this link. I cannot wait to answer your questions and discuss this topic some more with you!
‘Til the next blog, everyone!