Though most people know that estate planning is important, most people do not feel that their need for an estate plan is urgent. Most of us do not expect to pass away or become incapacitated in the near future. That lack of concern leads many to put off their estate planning, always feeling like there is more time. Unfortunately, procrastinating can have a huge impact on you and your family.
If you have people who depend on you for care, failing to plan can mean that those loved ones are left to manage a burdensome position if something unexpected happens to you. Minor children need a legal guardian, and a will enables you to nominate that guardian. But, if you pass without a will, a judge—who does not know you or your children—will determine who will become guardian of your kids. The guardian selected might not be the person you would have chosen.
Likewise, if you have loved ones who depend on your financial support, a lack of an estate plan can mean that your assets are not available to your loved ones for the many months it takes for your estate to go through probate. Simple planning can allow your loved ones, if anything happens to you, to have immediate access to your assets.
Further, without planning, your assets might not go to the people you would have chosen. If you pass without a will or trust, your assets will pass to your heirs according to state law. Such law is simply the government’s best guess as to whom you would want to inherit your assets. However, many people would not want their assets distributed this way. For example, in many states, intestacy law divides assets between a surviving spouse and children, even though many people do not want their children to inherit any assets until both they and their spouse have passed.
You, or a loved one, could also lose the ability to create an estate plan during your, or their, lifetime. A person must be of sound mind in order to create an estate plan. If you avoid facing your mortality (or that of a loved one) and making some tough decisions, you could find yourself in the heartbreaking situation of no longer being able to do your planning or help a loved one with theirs.
For those people without minor children or other dependents, it is tempting to think that no estate plan is really necessary, since no one is depending on you or your assets. For these individuals, the most important reason to create an estate plan is to determine who will help care for you during your life, if need be. You want to have named someone to handle your finances and medical decisions, should you need help with these tasks during your lifetime.
Even though you might not be enthused about estate planning, there is no time like the present. And when you are done, you will have the peace of mind that comes with knowing that your family will be protected.