It’s the time of year that we make resolutions. While many are broken within a few months, a resolution to finally getting your estate plan done is one you’ll want to keep.
If you’re like most people, you have no estate plan in place even though you know it’s important. It’s easy to procrastinate on getting it done and it’s a difficult topic to think about. But it always feels like we have another day to take care of what’s important…until we don’t. Here are some reasons why you’ll want to get it done early.
Control Over An Uncertain Future
There is a saying that when people make plans, fates laugh. It basically means that we can’t always control the future. I wish death and disability was something that we didn’t have to worry about. Even though we don’t know what to expect, we can still exert some control. In preparing an estate plan, you are creating a plan that can be implemented in the event of disaster. You’re naming people that you trust and have your best interests in mind and giving the power and ability to act. Once your estate plan is done, you’ll have the peace of mind that you and your loved ones will be taken care of.
Increased Flexibility And Options
In a related note, an estate plan can increase your options and provide flexibility during disaster. A well-designed estate plan does not simply say who gets what. It will also provide options for your loved ones when it comes time to put the plan in action. Will your spouse be too paralyzed to act while you are in the hospital or worse? Your estate plan should name a second successor that is ready to act. Is one or more of your heirs unable to inherit directly without impacting their medical or social assistance? Your estate plan can allow for the creation of specialty trusts to avoid such a distruption. We cannot predict which options, if any will be needed. But it is better to have an option and not need it than to need an option and not have it.
Save Money
There’s no doubt that getting sick, disabled, or dying can be expensive. It can substantially reduce the amount you pass on to your loved ones or even put them in a position of paying for your medical or death expenses. The reality is that many of these expenses can be reduced or even avoided. For example, probate fees can be avoided with an estate plan designed to avoid probate. Similarly, long-term medical care expenses can be avoided through the use of a Medi-Cal Asset Protection Trust. Even though few estates pay an estate tax, many pay wholly avoidable income and property taxes. Every fee and tax that could have been avoided comes straight out of your pocket or the pockets of your loved ones.
Once It’s Done, It’s Easy To Maintain
Once an estate plan is made, it can easily be changed to reflect changes in your life and the law. For most people, they only need to review their estate plan on an annual basis to make sure it accurately reflects their views and situation. So rather than waiting for the perfect time or estate plan, it is best to do the best plan possible now and make changes in a year or two, if necessary at all.
The Costs Of Not Having One Is Just Too High
Even though the odds of being disabled or dying in any particular day is small, the results are so traumatic that it makes sense to get an estate plan done as soon as possible. In many ways, getting an estate plan prepared is similar to getting life insurance. It’s one of the few services that you hope to never use but, given enough time, you and your family will be happy to have when the time comes. Unlike insurance, getting an estate plan prepared is a one-time cost. There’s no fee to keep your estate plan and most maintenance can be done by yourself.
If You Don’t Do It For Yourself, California Has Its Own Plan For You
That’s right. If you don’t have an estate plan, California has all sorts of laws and regulations that will apply to you. Your loved ones and heirs will be left to navigate these rules and the default estate plan known as intestacy. Even worse, these laws and regulations do not always work the way many people imagine. Often a court and county administrator will be involved in the decision-making process, or at least will have the power to interfere. And you’re loved ones may need to pay the court or county fees to boot! Get rid of unnecessary government interference by making your own estate plan. Once you have your own plan in place, you’ve opted-out of the default California plan.
If you’re looking to make the resolution to make your own estate plan in 2017, please schedule a consultation with Yeager Law. We can help you understand what you need to do to keep this resolution, whether you use us, someone else, or do it yourself.