People often believe that estate planning is necessary for wealthy people only. However, everyone can gain something from estate planning.
Therefore, you should talk to an estate law attorney if you don’t already have an estate plan. You should read this article to understand some of the critical advantages of estate planning.
1. Supporting Your Immediate Family
The estate you own can be a huge asset for your spouse and children after your death. If both the spouses expire, children can benefit from the estate plan.
However, if the children are minors, a guardian should be appointed to take care of the finances. You can even set up an estate plan to set up a special trust for your loved ones.
2. Reduce Taxes And Other Expenses
An estate plan will be able to minimize the amount of taxes on your property. This will enable the beneficiary to enjoy the asset that you allocate to them.
Otherwise, a significant amount from those assets goes into paying taxes. You can also keep the property transfer cost to your beneficiaries with the help of an estate plan.
3. Provide For People In Need
Family estate planning will help you to provide for your loved ones who need it the most. One of your children might have a disability, or your grandchild might need college funds. You can set up special trusts for them in your estate plan to support their needs.
You can even contribute to a cause you believe in even after your death. Sometimes people donate their assets or a part of their assets to a charitable organization.
4. Ensure A Succession Plan For Your Business
An estate plan is a handy way to keep a business moving after your demise. An estate plan specifies who will be in charge of the business when you become incapacitated or die. It also outlines what happens to your interest within the business.
5. Saves Against Any Kind Of Incapacity
You might suffer from a major illness or get involved in an accident. You should take estate planning consultation to ensure a proper plan ready to deal with such incapacities. You can even designate responsibility to someone who will make medical decisions for you when you are unable to.
6. Avoid The Process Of Probate
Estate planning ensures that the probate process is avoided. When a person without an estate plan dies, the court becomes responsible for asset distribution. The process is lengthy and often takes a lot of time. Additionally, you have to spend a lot on court proceedings.
- Why Should You Avoid The Probate Process?
A significant amount of your assets gets invested in covering court expenses. Your family also has to undergo a lot of trouble while the probate is going on. Sometimes the results of a probate process are not even satisfactory.
- Your family might have to wait for as long as nine months for the process to get over. Meanwhile, they have to pay your medical bills, funeral arrangements, and other expenses.
- Additionally, probate will make your estate records a piece of public information. If you create trust, you will have much more privacy. Moreover, a trust can offer a lot of protection to your assets.
7. Protection For Your Children
If you and your spouse both die, your children will be left alone. You have to name a legal guardian for your children. The legal guardian will be responsible for rearing up your children in your absence.
- They will also be able to manage the finances for your children until they become a legal adult.
- Therefore, you should appoint someone you trust as the legal guardian of your children.
- A lack of estate planning causes the court to get involved. In such a scenario, your children might end up with someone you do not trust. The court will not know who will be able to take proper care of your children.
So, in most cases, your children end up with the immediate relative even if they are not reliable. Your children can even end up with Child Protection Services if the court finds no one fit to take care of your children.
8. Save Your Family From Making Difficult Decisions
Your death will cause a lot of grief to your family. You can reduce their burden by clearly mentioning your funeral wishes in your will. You can even pay for your funeral arrangements in advance.
However, you should inform someone that your funeral wishes are laid down in your will. It often happens that the family member comes across the will after the funeral is over. In such a situation, your funeral wishes will not be considered by your family.
Estate planning needs to be done with relevant advice from financial planning lawyers. You should take advantage of estate planning, as caring for loved ones is always a priority.