There are a number of reasons why people choose to craft an estate plan and work with an attorney.
Even though sitting down to come up with an estate plan can be a time consuming, and even stressful affair, taking the time to come up with one is an important and necessary step towards setting yourself up for the future.
Here are five reasons why you need an estate plan.
1) To Keep Your Beneficiaries Protected: Many people who come up with an estate plan intend to keep their beneficiaries safe, especially if they are minors or adults who might have a propensity to make bad decisions. They are also used to keep adult beneficiaries safe from divorcing spouses, issues with creditors, and other negative outside influences.
Taking the time to appoint a guardian for any minor beneficiaries in your estate plan will save a lot of time, and a lot of expensive legal proceedings. It also gives you the chance to safeguard against bad financial decisions by other adult beneficiaries and make sure your wishes are respected.
2) To Safeguard Against Creditors: Estate plans are important because they can keep you and your beneficiaries safe against any unforeseen creditors. Once a creditor comes after your estate, or a lawsuit opens up, it can often be too late to take steps to protect your assets. A good estate plan coupled with a solid financial plan will help keep your assets safe.
3) To Smooth Over Issues: A lot of people opt with an estate plan
after watching a family or friend struggle with attorneys and finances as they try to pick up the pieces after not making an estate plan.
Setting one up and making decisions about your financial future will make things a lot easier after you pass away, or if you somehow become mentally incapacitated.
Good estate plans will also help keep living spouses safe from outside influences, especially if you take the time to arrange an ABC or AB trust.
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4) To Keep Away From Probate: One of the most common reasons people choose to make an estate plan has to do with probate. Most people know it is something to avoid at all costs, and they are right. The horror stories from probate are numerous. Many people have a sad tale about probate, so crafting an estate plan is a good way to avoid some of the same stress and worries others have faced.
5) To Slash Estate Taxes: Many people come and work on an estate plan to prevent the state or federal government from swooping in and taking a large chunk of money away through inheritance or estate taxes. Even the most basic estate plan can help you save a lot of money on, or even totally eliminate estate taxes.
Good financial planners and attorneys will be able to guide you on how to set up different types of trusts as part of your estate plan, and give you advice on some of the techniques and tricks that can be used to reduce an inheritance tax burden.
Keep these five tips in mind while you are thinking about setting up an estate plan. Even though the process can be time-consuming, it will be a lot better for you and your family if your finances are squared away while you are able to make decisions about potential beneficiaries and asset distribution.
Do you have a question about estate planning? Click here to contact the experts at Hunsberger Dunn LLP today!
Courtesy of Cuselleration