While there isn’t a definitive time to create your estate plan, this is something you should do as early in life as possible. Contrary to common myth, you don’t need to build wealth before an #estate plan is useful. As you will see below, estate planning helps you protect your loved ones under any circumstances. Creating a plan early in your life will help you ensure your loved ones and #assets are protected if you suffer an unexpected illness or injury that leaves you incapacitated.
Protect Your Minor Children
Even today, far too many people die intestate or without a will, believing that they don’t have the wealth to make a will necessary. While choosing your heirs is one aspect of will planning, that’s not the sole function of this estate planning tool. A will is also necessary if you have any minor children who will need to have a guardian appointed to them. If you die intestate, the courts will choose their guardian, and a family court judge may unwittingly choose someone you may not have trusted to care for your children. In that situation, your children may be placed with an abusive ex-spouse or a family member who isn’t responsible or mature enough for a parenting role. When you make a will, you can choose a guardian for your children.
Protect Your Assets From Probate
During the probate process, your assets will be liquidated to pay off your remaining debts and your estate taxes. While there’s no way around this process, you can protect certain assets by using a living trust to transfer them to a trustee. The trust automatically transfers certain assets to the trustee upon your death, ensuring they won’t be inventoried and liquidated for probate. If you have a family heirloom or a piece of artwork that you want to ensure goes to a child or spouse, transferring it via a living trust may be the best solution. Since the living trust is a private document, you can keep the transfer of assets private from other family members as well.
Choose How Your Assets Are Distributed
While there are certain legal requirements in determining how you divide up your assets, an estate planning law firm in Los Angeles or your local area can help you choose your beneficiaries and heirs. They will help you ensure your assets don’t go to an ex-spouse while helping you make sure the children from that marriage do receive any assets you intend to leave for them. You can also use estate planning services to guarantee your new spouse receives what you intend to leave for them. Estate law can be complicated, but working with an attorney can help you determine that your final wishes will be respected.
Prepare For Your Medical Care Needs
If you’re involved in an accident, you may suffer serious injuries that prevent you from communicating your wishes in regard to medical treatment. Alternatively, you may become mentally incapacitated as the result of dementia or another cognitive illness. In either situation, you will want a healthcare proxy in place that designates someone of your choosing to make medical care decisions for you. Without a healthcare proxy in place, the court may choose a proxy for you, and they may choose someone you mistrust. It’s better to plan for this eventuality in advance to ensure you can choose the individual who will be responsible for your care. This also gives you the opportunity to express your wishes to your proxy in advance so they can make the decisions you would have made for yourself.
Leave Your Finances in Someone You Trust
Your estate planning lawyer can also help you create a financial power of attorney. You can choose one individual, or you can divide these responsibilities up between multiple individuals. For example, if you own a business, you may want a business partner to maintain control of the business. You can create a power of attorney for that purpose, and you can create a separate power of attorney that leaves a spouse or adult child in charge of your personal finances. Making these plans in advance will lead to less confusion if you do suffer an incapacitating illness or injury.
Once you create an estate plan, you should review it once a year with your estate planning attorney. This will help you update your plans to include any new assets you have acquired. It will also provide an opportunity to modify your plan to account for changes in your family, such as the addition of a new child. By reviewing your plan regularly, you can enjoy the peace of mind in knowing your family will remain protected in the future.
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