An estate plan can be beneficial in reducing and keeping tax bills to a minimum. However, New York residents and others may benefit from estate planning in other ways as well. For example, it allows a person to organize important documents and other items that may need to be accessed quickly after he or she passes away. These documents may include passwords to digital files, a list of debts or a summary of that person's final wishes.
Creating an estate plan may make it possible for people to have their assets transferred to their beneficiaries without the need for probate. If probate is necessary, with estate planning, an individual may limit the number of assets that are subject to the process. By avoiding probate, individuals may settle their affairs in a manner that protects their family's privacy. If a person creates a trust, it could allow for an inheritance to be distributed in a manner that makes sense for his or her beneficiaries.
If a beneficiary is a minor or otherwise incapable of handling money, it may not be a good idea to transfer large sums of money to that person at once. Trusts can also help care for those with special needs or protect assets from creditor claims. In some cases, they can help ensure that assets are available for several generations into the future.
Taking the time to make an estate plan may help an individual while he or she is still alive and after his or her passing. It may also make it easier to provide for family members and others who may rely on that person. An attorney may be helpful with drafting estate planning documents. He or she may also be able to review and alter any documents that are currently in existence. Doing so may reduce the chances that they are declared invalid.