We are often asked, “Do I need an estate plan if I’m not rich?” and every time we respond the same way: “Absolutely!” Although most of us have likely never considered it, we all have an estate. Your estate consists of all the things you own- your real and personal property. Your home, vehicle, checking account, savings account, stocks, 401K/retirement, life insurance, land, and your personal possessions are all examples of assets that make up your estate. You may think your estate is not large enough for an estate plan, but the size of your estate should never stop you from estate planning!
So, what is estate planning? Estate planning is the process where an individual, or family, determines and arranges the distribution of their estate prior to their death. Estate planning allows you the ability to identify who receives what assets and enables you to ensure your wishes are carried out after your passing, often with less family stress and turmoil. Additionally, proper estate planning provides you the opportunity to protect your heirs from unexpected federal and state consequences and the ability to avoid a potential Medicaid lien.
Estate planning extends beyond asset distribution. Estate planning also includes a last will and testament, a living will, a durable power of attorney, trusts, and parental appointment of guardianship. Each of these estate planning components will be covered in more detail in forthcoming blog articles.
Estate planning should be an ongoing process, and not just a one-time event. As we grow older, our assets (hopefully!) increase, and our family grows. With these changes, our priorities and desires often shift. Fortunately, your estate plan can be changed anytime you want. To that end, it is vital that you update your estate plan as your financial circumstances and family dynamics change.
Now is the time to handle your estate planning! We all hope to live until we are old, but sadly, none of us have control of that, and accidents and illnesses do occur. Estate planning is not just for the old; it’s for anyone with an estate- including millennials. In the event you do not have an estate plan when you die, your estate will distributed according to our state’s intestacy laws.
Simply put, if you do not plan your estate, someone else will!
By Jim Golden