A common misconception is that only the wealthy need an estate plan. Although minimizing taxes for high value estates is one aspect of estate planning, there are many more benefits. Here’s why estate planning is important for everyone, not just the wealthy.
1 – Eliminate Unnecessary Expenses
A lengthy probate process can be expensive. Unless your heirs are attorneys, they will likely need to hire one to assist with filing paperwork and attending court proceedings. Most attorneys will charge hourly for such services. As you can imagine, this can quickly add up and reduce the value of the remaining assets. For heirs that may not have funds to hire an attorney to begin with, it can be an added hardship. Creating an estate plan that avoids probate is one of the main reasons why estate planning is important for everyone.
2 – Provide Immediate Financial Support
Could your dependents survive for months before receiving any financial support? For most people, their dependents rely on their immediate and continual support for everyday needs. A delay of months or even years, while the probate process completes, could be detrimental. An estate plan is the only way to eliminate the delay caused by probate.
3 – Avoid Unintended Heirs
You may assume that your assets will go to your spouse and/or children, but that may not necessarily be the case. Massachusetts follows succession laws which determine heirs based on your marital status, living parents, children from current and/or previous marriages, siblings, etc. Heirs are identified during the probate process, but potential heirs are also given an opportunity to come forward. Regardless of the value of your estate, unintended heirs will dilute that value and leave less for your intended heirs. This is another reason why estate planning is important for everyone.
4 – Control Asset Distribution
If your heirs are not accustomed to having large sums of cash, you may be concerned about how they might manage a lump sum inheritance? Spreading distribution of funds over several years and/or until your heirs reach a certain age can help prolong the benefit of their inheritance. This is particularly important for young adults. You can even condition disbursements on milestones such as completing college.
More on Why Estate Planning Is For Everyone
When you consult with an estate planning attorney, you’ll notice the focus is on your estate planning goals rather than solely on the total value of your estate. Sure, assets are a consideration, but it is one of many factors. Every estate plan is different and is designed to fit the unique circumstances of the individual. The important thing to know is that regardless of whether your estate is worth $100 million or $100,000, you can protect your assets, maximize value, and avoid unwanted outcomes with a well-prepared estate plan. Everyone can benefit from the protections available in estate plans,… which is why estate planning is important for everyone.
Contact our team to schedule a free consultation and to learn more about the benefits of estate planning.