10 Things Estate Planning Can Do For You
I know you know you need to have an estate plan together. We all know it. We all get that it’s important. Yet so few of us have it (including me until very recently, and quite truthfully, NOT at the time that I wrote this article). Why is estate planning so difficult to understand?
All I can do to get you to put something together (and I don’t care if you do it with us so long as we do it – I will win you over and you’ll come and see us some day) is to try to scare you and show you the kind of money you can save and show you the kind of money you can earn and show you the kind of impact you can have on your family.
If those things don’t do it for you, nothing will. So let’s just dive right in.
1. Provide for your immediate family
This is the one thing you need to know about estate planning: without it, your beneficiaries (your spouse or significant other and kids) will get less and it will take them much longer to get it.
If you take the time to prepare you can arrange for life insurance, the transfer of your property, you can choose the person who will make sure your wishes are followed, and even protect your money from outside creditors.
And let’s not forget what I think is one of the most important things you can give: your knowledge and experience. People aren’t going to remember your money when you’re gone, but they will remember your advice, your love, and your history.
2. Provide for other relatives who need help and guidance.
Going outside of your immediate family a well organized estate plan can take care of parents, disabled children, grand-children, and anyone else that is important to you.
This will be a common theme you hear again and again, but if you die without an estate plan you have no choice in how your property is distributed. There is a formula set by the state, and that’s how your stuff is handed out. Period.
3. Get your property to beneficiaries quickly.
You have two options here. Option 1, your family has to wait at least 3 months to get anything after you die. Option 2, your family gets money they need to pay bills, to pay for your funeral, to pay for your outstanding medical bills, and buy levitra online to pay for anything else they need, RIGHT NOW.
Which one would you prefer?
There are ways to avoid those big delays. You don’t need to necessarily know how to avoid them, what it’s important is an estate plan can do that for you.
4. Ease the strain on your family.
Do me a favor real quick – by the way, you aren’t going to like this.
Imaging your spouse just died. Or your significant other.
Now, imagine less than 48 hours after that getting a call from a funeral director asking you what they should do with your partner.
Not fun, right?
You can ease this burden by thinking about it in advance and planning this stuff. And remember, there’s no better person to do this than you. You’re the one that will get it right.
5. Minimize expenses.
Do you know where most of the money goes when people don’t have a good estate plan?
When you die without an estate plan the court is forced to handle everything. The way they do this is to appoint people to take care of your business. Those people are attorneys, and they bill by the hour.
In addition to that, there can be significant costs transferring property to your beneficiaries.
But it doesn’t have to be like that. A good estate plan saves money, reduces the burden on your survivors, and simplifies administration of your estate.
6. Reduce taxes on your estate.
Think about this: every dollar you have to pay to the government is a dollar your family doesn’t get.
The easiest way to prevent this is to start giving away some of what you have before you die.
The second easiest way to prevent this is to set up some trusts to take care of it.
Either way, the answer is to have thought about it beforehand and done what was necessary to avoid having to pay any taxes.
7. Make your retirement years easier.
Believe it or not, there is actually a real, tangible benefit to you by putting together a good estate plan.
A good estate planning takes you into account too.
Here are just a couple of things that can be taken care of through a comprehensive estate planning: health care in later years; retirement; and who will help you when you can no longer help yourself.
And, while most estate planning lawyers won’t tell you this, I will. If you are facing some significant estate taxes when you die, one of the ways to reduce your estate is to spend it on yourself. You can create those experiences in your life that matter.
8. Plan for incapacity.
What we’re talking about here are health care advance directives, living wills, and durable health care powers of attorney.
These things help you make decisions in advance about life support and pick someone to make decisions about your medical treatment.
One of the things we’d definitely talk about too is disability insurance (I have it). Disability insurance guarantees you a “salary” if you are ever injured and can’t work. It’s a must have if you contribute in any significant way to your family.
9. Help a favorite cause.
Warren Buffet isn’t the only one who gets to donate some of his estate to charity.
Your estate plan can help support religious, educational, or other charitable causes.
You can set it up so the gifts are made during your life or after your life, and if you have a decent estate planning lawyer, these gifts can help you take advantage of tax laws designed to encourage people to give.
10. Make sure your business goes on smoothly.
If you are a business owner YOU MUST HAVE AN ESTATE PLAN.
This is not a suggestion. If you don’t have something set up to help things run smoothly if/when something happens to you you are doing a disservice to your family. Period.
You have the opportunity to provide for an orderly transition to someone else and continue the business by spelling out what happens if you become disabled or die.
Take the opportunity to do this. If you are small business owner your legacy is nothing without this.
Okay, that’s it. We covered it all. Fear. Saving money. Making money. Legacy. There are 10 great reasons to get your estate planning done today. Stop procrastinating. Just do it.
P.S. Do you have kids? Have you completed guardianship paperwork? Have you done it correctly? Click here to find out what happens if you don’t do anything: Are you okay with a judge choosing the guardians of your children?
P.P.S. Do you own a business? Do you have a plan so the business, and your family, can survive if something happens to you? If not, click here to learn how simple it is to protect your business and your family from tragedy: 5 Ways to Protect Your Business from Catastrophic Failure.
P.P.S. Do you have no kids and think you don’t need an estate plan? Single and think a will is only for married couples. You couldn’t be more wrong. Click here to learn more: 5 reasons estate planning is a must have even if you don’t have kids.
Christopher Small is a Kirkland estate planning attorney who helps people get rich and live forever. He is also the owner of CMS Law Firm LLC.