Estate planning is important for everyone, regardless of age or wealth. estate planning avoids taxes and legal blockades, and ensures that funds are read the way you want. An estate plan designates the right people to take care of your children and even you if you are disabled. Make sure your assets go to the right beneficiaries Without an estate plan, your assets can be channeled through the probate process, meaning you won't be sure that your boat went to your son or that your daughter received the money she needed to attend a college, for example.
By creating an estate plan, you can structure the distribution of your assets however you want. If you have a former spouse you want to exclude from your assets or a child who does not want to inherit from you, estate planning can also accommodate these wishes. Plan Your End-of-Life Health Care Estate plans can do more than just distribute your end-of-life assets. They may also provide you with end-of-life care with a health care power of attorney or health care power of attorney.
These documents set out your decisions about your end-of-life treatment preferences in case you are unable to make these decisions on your own or express your wishes. You can designate a loved one to make decisions for you or write your own decisions for future reference. Estate planning is about empowering people to make their own decisions 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.
Estate planning is much more than deciding who to leave your things to, it's about taking care of your loved ones when you're no longer here. There are generally two main reasons why you may want to protect your beneficiaries. First, your beneficiaries may be minors, in which case state law (and good practices) requires that a guardian or conservator be appointed to supervise the child's needs and finances until he or she is of legal age (18 years old in New Mexico). However, as we all know, in some cases, adult beneficiaries also need protection, which leads us to the second main reason why people may want to consult an estate planning lawyer.
In some cases, you may want to protect your adult beneficiary from poor decisions, outside influences, creditors, or even your spouse. You can isolate your beneficiary's inheritance from a dominant spouse or partner who could waste your inheritance or possibly take it on a divorce. Significant loss of own wealth due to payment of state and federal estate taxes or state estate taxes is a great motivator for many people to draw up an estate plan. Many people are unaware that the death benefit, not just the cash value, of the life insurance policies you own are subject to estate taxes.
Everyone, regardless of family dynamics or financial situation, can benefit from having an estate plan, a collection of documents that specify how you want your assets to be distributed. While there are a variety of reasons why people decide to meet with an estate planning lawyer and create an estate plan, here are five of the most valuable reasons. If you die without a will, which is a vital part of an estate plan, the courts will decide who gets your assets. Creating a comprehensive estate plan to manage your assets and support your loved ones after you die is one of the most rewarding tasks you can undertake.
For example, if children are not old enough or mature enough to handle a large inheritance, an estate plan can address this by making provisions through a trust. A comprehensive estate plan can help you feel more secure about the future, knowing that your loved ones will be taken care of and that the legacy you leave behind is what you want. Avoiding probate is easily one of the most common reasons people seek the guidance of an estate planning attorney. Because the IRS sets limits on how much money you can transfer and to whom without paying taxes, a good estate plan outlines an wealth transfer strategy that attempts to minimize the taxes owed by you or your estate.
Without the proper estate plan, your children can be placed in foster care if you and your spouse die. An estate plan can ensure that your children are cared for by a family member or designated guardian you trust. Avoiding High Taxes In some cases, estate planning can help you legally avoid costly taxes that can adversely affect your estate. While a will is a cornerstone of estate planning, some people may need something broader and, if so, a trust can be beneficial.