Most people are aware of the benefits of having a will. While considering it may seem like a dark subject to some, it is necessary if you wish to be responsible with your property. With this in mind, we are often surprised to learn how few people are aware of early estate planning and how useful it can be. So, for this article, we will focus on the importance of early estate planning and hopefully convince you to consider it.
Understanding early estate planning
Among those who have heard about early estate planning, there are those who believe it to be a synonym for a will. While there is some overlap, it is important to note that the two are different things. The easiest way to think of them is that early estate planning usually encompasses your will. Of course, this boils down to how you organize your paperwork with your attorney.
Early estate planning ≠ a will
Both early estate planning and your will should detail what will happen to your goods and assets once you die. But, with early estate planning, you can cover much more. For instance, you can outline who will make financial and medical decisions if you cannot do so. You can outline what kind of medical treatment you wish if you get incapacitated. And you can designate who will receive money from various insurances, retirement accounts, and annuities. It is possible to cover some of these aspects within a will. But it is usually far easier with early estate planning.
Saving time and money
But why should you go through the trouble of early estate planning? Surely your loved ones can take care of things if you cannot. And if they are familiar with your wishes, they will see they are fulfilled. Let’s assume that you have loved ones to speak of (not all people are so fortunate). Deciding what to do with a person’s property can be tricky. Some people might feel entitled to certain assets, while others might disagree. It is not uncommon for family members to have legal feuds over inheritance, many of which can last years and cost a fortune. Add to this the fact that a third party will need to evaluable your assets before your beneficiaries can claim them, and you will soon realize the trouble that can quickly arise.
So, why not save everyone from trouble? With early estate planning, you will outline clearly who gets what. The result is entirely legally binding and unalterable. Similarly, you can outline what should happen if you get stricken ill, and there needs to be a decision made about your treatment. You can have people take care of your pets and ensure their well-being. You can even reach out to an expert team and set up residential movers to transport your items to designated storage in Orlando. All in all, making such plans is difficult. But it can save your loved ones from quite a bit of trouble.
Avoiding large taxes
When people inherit something from their elderly, they need to pay an inheritance tax. Depending on where they live, they may even have to pay estate tax. So, while inheritance tax might seem like something that only millionaires should worry about, you shouldn’t shy away from researching it. You’ll learn that a sizable chunk of your inheritance will go to the state. There are federal taxes you will need to settle. But you’ll also learn that there are ways to circumvent state taxes. Trust, joint accounts, gifts… These are all different ways to provide for your family without the state taking part in it. And you can set all these up with early estate planning.
Child custody
If you are a single parent, you’ve likely wondered what would happen to your child if something happened to you. If there are some living relatives that are close to the child, it is only natural that they adopt them. But can you be sure that this will happen? Well, with early estate planning, you can. Along with trust funds, you can outline guardians to help raise your child. You can set up precise financial aid for your child and see that they receive their inheritance in the fullness of time. You can also point out alternative guardians if something happens to your primary choice. Ideally, you should discuss the issue of guardianship with the people you trust. And only pick those that have your fullest confidence.
Living will
As we pointed out earlier, with early estate planning, you can outline what happens if you become incapacitated or otherwise unable to take care of your estate and yourself. In legal practice, we refer to this as a living will. In it, you can not only outline what kind of medical care you should receive. But you can also outline the instructions for managing your property and assets. You can give durable power to a person you trust and have them manage your property until you are once again able to.
Final thoughts about the importance of early estate planning
By now, you should have a fairly good idea of the importance of early estate planning. While it may seem a bit macabre to consider what will happen if you die, we assure you that it doesn’t have to be. Most people feel relief once they are done with early estate planning. Knowing that there are no issues and that your loved ones will be provided for is comforting. Others realize how dangerous inheritance can be for a family, especially if the members are estranged and wish to revoke their last will. Therefore, while you may hurt some feelings, you will effectively save your family from considerable trouble and stress.