Estate planning has become a matter of utmost importance in recent times. More and more people are becoming serious about developing an estate plan.
You can take legal advice from an estate planning firm to effectively distribute your assets. But if you are still wondering why you need an estate plan, here are some benefits.
1. Avoid Probate
A probate process revolves around the verification of a deceased person’s will. People often consult estate planning lawyers to avoid probate. People want to get rid of probate at all costs because of the horrors associated with it.
- You might have heard stories related to probate narrated by friends, neighbors, or business associates. An estate plan is an effective way of avoiding the horrors associated with probate.
- Additionally, an estate plan will also help in minimizing your expenses. Most often, a significant amount of a person’s assets gets spent in the probate process.
- You will find that what you wanted to leave behind for your loved ones will get exhausted in court expenses. Therefore, an estate plan will prevent the court from stepping in to take care of your finances.
2. Reduce Estate Tax
An estate plan is often created to minimize the tax burden related to estates. You can contact a living trust lawyer to set revocable trusts for reducing tax.
Married couples can even eliminate estate taxes by setting up AB trusts or ABC trusts. Several other advanced estate planning techniques can also help married couples and singles avoid paying high taxes.
3. Avoid Family Conflicts
A lack of estate planning can create unnecessary strife within family members. Many people go to an estate lawyer after seeing a friend or associate experiencing a lot of hassle because an estate plan wasn’t in place.
- In the absence of an estate plan, the court supervises the distribution of assets. It leads to a waste of time, and often a considerable amount gets spent on the court proceedings.
- Sometimes the verdict given by the court is not even satisfactory. Therefore, an estate plan can help in preventing family fights as well as probate proceedings.
4. Protect Beneficiaries
An estate plan can benefit minor beneficiaries. But it can also help an adult beneficiary by stopping them from making wrong decisions.
- In case the beneficiary is a minor, the law often requires the appointment of a guardian. The guardian is responsible for taking care of the minor’s needs and finances until they become legal adults.
- Moreover, an estate plan will ensure that you children are not taken care of by protective services. It is unpleasant to imagine that your children will be under Child Protective Services.
- But if you do not have an estate plan and you and your spouse both become incapacitated, the Child Protective Services will come in.
5. Protect Assets
An asset protection attorney can be appointed to protect your assets from a lawsuit. A financial plan coupled with estate planning can protect your asset for your advantage and the benefit of your beneficiaries.
The involvement of the court only complicates the process of asset distribution. It also makes the process of asset distribution among family members lengthy.
6. Make Retirement Easier
Most people think that estate plans benefit their family after their death. However, you will realize that it can help you even when you are alive. An estate plan can particularly help you in the arena of healthcare.
- It will help in reducing your healthcare costs by a significant amount. You will even be eligible for government benefits.
- Therefore, healthcare costs won’t deprive the assets you want to leave behind for your loved ones.
7. Plan For Incapacity
Estate planning will prove to be beneficial if you suddenly become incapacitated. You might have a terrible accident and slip into a coma. Even a sudden medical episode like a stroke can make you incapacitated. In such instances, you will be unable to manage your financial affairs.
Someone will have to take care of your finances on your behalf. You need to appoint a power of attorney to handle your financial affairs on your behalf. You can even set up a healthcare directive.
- Why Should You Set Up A Health Care Directive?
It will ensure that your medical treatment is carried out according to your wishes. It will also save your family from making difficult decisions, such as when to pull the plug. You can specify all these in your estate plan and protect your family from making such heart-breaking decisions.
8. Support Your Favorite Cause
You might want to donate a portion of your fortune to a charitable cause. You will have to keep an estate plan ready to ensure that the money goes to charity. You will be making a huge difference even if you are unable to contribute a vast amount.
These are the few significant benefits of estate planning. You should hire a trusted estate attorney to put your estate plan in place.