There are a lot of commonly misunderstood aspects of estate planning. The spread of myths and misinformation can make it easy to talk yourself out of estate planning. You may assume you do not need to have a will or trust just because you are not at a certain income level or age. But the truth is that everyone needs an estate plan, whether your net worth is $20,000 or $20 million.
No matter the value or complexity of your estate, some solid facts make it helpful for everyone to have a plan. Here are the main motivating factors for implementing an estate plan.
Make your wishes clear and legally binding
One of the core purposes of an estate plan is voicing your desires regarding your property and money. A will lets you decide who receives your available assets and who serves as the guardian of your minor children. You can get even more in-depth with your wishes regarding health care and money decisions with powers of attorney and advance directives. When you put your wishes into these legal documents, you can have confidence that the probate court and your family will fulfill them.
Protect your loved ones
If you die without an estate plan, your family and friends will need to deal with laws and government complexities. This often involves expenses, taxes and legal hassles. You can save your beneficiaries confusion and headaches by writing everything out.
Leave a legacy
Another element of estate planning is leaving whatever assets you have to the people or causes you care about. An estate plan allows you to leave behind a legacy via financial security for heirs, charitable contributions or burial or memorial services. Planning ahead and updating your estate planning documents ensures you are proud of what you leave to the world.