Everyone needs an estate plan, regardless of their age. Unfortunately, death does not only affect the elderly and accidents happen. There are four main reason that every adult needs an estate plan, in case they were to pass away:
- To avoid probate. Probate is the process of a court validating a deceased individual’s will and valuing their assets, making sure their final bills and taxes are paid, and distributing what is leftover to their beneficiaries. Avoiding the lengthy, expensive probate process is by far the number one reason people seek out estate planning attorneys.
- To reduce estate taxes. Many people fear their families losing a significant amount of their estate to federal estate taxes or state inheritance taxes. Even the most basic estate planning can reduce or eliminate estate taxes altogether by using a trust along with your will to distribute your assets.
- To protect beneficiaries. There are two types of beneficiaries that tend to motivate us to create an estate plan for their protection: minor children and adults who are either disabled or suffer from financial issues. If your beneficiary is a minor, you are required to appoint a guardian or conservator to oversee their inheritance until that minor reaches the age of adulthood.
- To protect assets. Asset planning is a major part of estate planning. If you suspect that a lawsuit against you is coming, it is likely to be too late to plan to protect your assets. You need to create a sound financial plan as soon as you start acquiring assets and then expand it into an estate plan that protects your assets for the benefit of you and your beneficiaries.