5 Reasons Everyone Needs an Estate Plan
Estate Planning is about empowering people to make their own choices about their future and the future of their loved ones. The following are 5 of the most common reasons people decide to create an estate plan.
1.) Avoid Probate
Avoiding probate is easily one of the most common reasons people seek out the guidance of an Estate Planning Attorney. Anyone who has ever had to deal with the stress, strain and cost of probate court knows that you want to avoid it at all costs. Probate is the painful process that takes place after someone's death. It usually involves proving to the court that a deceased person's will is valid, or worse still, identifying and cataloging the deceased individual’s property, appraising that property, assigning and paying debts and taxes and distributing the remaining property. As you can see, it is a very involved (and expensive) process with many variables and opportunities for issues, conflicts, and family infighting. Typically, this process involves lawyers and court fees that are paid for by the estate, which just wastes money and resources that could otherwise go to the individual's beneficiaries. While many of the problems with this process may seem obvious, many others can be found in the countless horror stories and news stories we have all probably heard about probate. That's why the best practice is always consulting an experienced attorney that can help you avoid these problems before they ever become a factor.
One tool that many estate planning lawyers use to avoid probate is Trusts. Unlike Wills, Trusts allow you to transfer property to your heirs right away without having to go through probate, and as we will discuss, can also provide you with tax benefits.
2.) Reduce Taxes
The very real prospect of losing a very significant portion of your hard-earned estate to state and federal taxes is always a great incentive for seeking estate planning advice. Using their attorney, married couples can reduce or even eliminate many estate taxes altogether by using tools like AB trusts or ABC trusts. You can also reduce the burden of inheritance tax on your children or grandchildren quite significantly if you have the right attorney on your side.
3.) Avoid the Ugliness
Most of us have had experience or have at least heard of the ugly family infighting that can happen in the aftermath of a loved one's death. Aside from wasting time and money, failure to make a comprehensive estate plan can create chaos for your family and can often lead to major rifts and damaged relationships. Making fundamental decisions like who will be in charge if you become mentally or physically incapacitated, who gets what, when they will get it and how they will get it can be crucial in avoiding family infighting and costly probate court proceedings.
4.) Protect your Beneficiaries
Estate planning is much more than just deciding who to leave your stuff to, its about looking after your loved ones when you are no longer here. There are generally two main reasons you may want to protect your beneficiaries. First, your beneficiaries may be a minor, in which case state law (and good practice) requires a guardian or conservator to be appointed to oversee the minor's needs and finances until they become of legal age (18 in New Mexico). However, as we all know in some cases adult beneficiaries need protection too, which brings us to the second major reason people may want to consult an estate planning attorney. In some instances, you may want to protect your adult beneficiary from bad decisions, outside influences, creditors, or even their spouse. You can insolate your beneficiary’s inheritance from an overbearing spouse or a partner who might squander their inheritance or possibly take it in a divorce.
5.) Protect your Assets
In recent years, asset protection has become one of the most popular (and important) reasons people consult an estate planning attorney. Once you are aware or suspect that a lawsuit or divorce is on the horizon, it’s too late to put a plan in place that can protect your self and your assets. With the right estate planning attorney, you can create a sound financial plan that, in conjunction with a comprehensive estate plan, can protect your assets, both in your lifetime and after your gone. You can even provide asset protection for your spouse and ensure the future success of your children through the proper use of AB trusts, or ABC trusts.
While everyone's situation and wishes are different, it is important to consult an experienced estate planning attorney who will listen to your needs and can create a customized plan that puts you, and your loved ones in the best position possible for the future. Genus law group can provide a personalized solution to your estate or family law issue. Call (505) 317-4455 or chat with someone online to start solving your problem today!