Is Estate Planning for Everyone?
Estate planning is more than a method to avoid. Many young families might be surprised to learn that they should think of estate planning. Nowadays, there is an effort to eliminate or confine estate taxes to the rich only. Congress changes the tax laws constantly. By that, there is no guarantee that the trend will continue.
Estate planning is less involved with taxes and more with who inherits the estate; those who cares for your minor children, how you feel about life support measures, or who will control your affairs if you are unable to. Your estate is your possessions. If you have a will, your estate will be distributed in accordance to your wishes. If you don’t, they will be distributed under state intestate laws.
You are to check the laws in your state. There could be cases that if you die without a will, your parents would inherit your property instead of your wife or the money could go to distant cousins instead of your lifelong companion. The first reason for a will is to have the properties distributed according to your wishes.
Many parents use estate planning to try to rein in their out-of-control children. They may provide a bequest that starts when the child is matured. Grandparents use estate planning tools to provide for all or only part of their grandchildren’s college education. They may choose to bypass their family and leave their money to their favorite charity. A business owner could pass his business to his partners or employees in order to keep the business running.
Naming subsequent beneficiaries is a common use of estate planning. It appoints guardians for minor children or disabled relatives you are caring for. When leaving a bequest, you need to appoint someone who will take good care of the money of the minor person.
If you are ill or facing the prospect of unable to take control of your affairs, estate planning techniques like the power of attorney, property transfers or a relative as a joint owner of your property and bank accounts can be used providing a living will directing how far you want life support measures when terminally ill.
The proceeds of most life insurance policies and jointly held property with rights of survivorship are not generally part of the probate state. Many believe that they can use these instead of a will but only the specific property held jointly is to be transferred.
The method of estate planning is leaving it in the hands of a professional. Simple wills are not expensive, but if you have to go beyond simple, hire the right professionals. Estate planning is a complex field; therefore, you should consult a qualified estate planning firm.
