Why Having An Estate Plan Is So Important.
Top Five Consequences Of Not Having An Estate Plan
1. LOSS OF CONTROL
If you pass away prior to documenting your wishes about who is to receive your property, it frequently means a judge will make those decisions for you in probate court. Not only does probate result in a loss of control, but it can also be time consuming, expensive, and create conflict between your family members. Probate can result in multiple parties having to retain attorneys to represent their interests with the outcome likely not being what you wanted or intended. Preparing a trust with the help and guidance of an experienced estate planning attorney is, in the long run, less expensive and a reliable tool to control the distribution of your assets and ensure your wishes are efficiently implemented.
2. MISMANAGED MEDICAL DECISIONS
It’s important to recognize an estate plan is much more than a will or trust. One very important component is a Healthcare Power of Attorney, also known as an Advanced Directive..Unless you designate someone with the authority to make medical decisions and document your wishes on issues such as life support, artificial feeding, and organ donation…your intentions may not be carried out and doctors or others may make choices that conflict with your personal beliefs. Without direction to the contrary, doctors will generally take all steps possible to preserve life. But what if those steps meant your quality of life would be severely compromised? What if you would be living in a coma for a long or indefinite period of time? Is this what you want? Without a Healthcare Power of Attorney, you leave those decisions up to others who may not know your preferences and create the potential for conflict between family members who have differing beliefs on what you would want.
A Durable Power of Attorney allows you to designate specific individuals to manage your affairs in the event you become incapacitated. Choosing people you trust to manage your bills, investments, and look after your assets…as well as giving them the legal authority to do so requires a properly executed legal document recognized by the courts, banks, real estate brokers, financial advisors, insurance companies, etc. Without a Durable Power of Attorney, no one can make financial decisions on your behalf-even a spouse- and the only way someone can obtain such authority requires a conservatorship. A conservatorship is a legal proceeding in the probate court. It can be expensive, time-consuming and confusing. Importantly, the person a judge appoints as your conservator may not be someone that you would have chosen. Creating a Durable Power of Attorney ensures that you control who makes financial decisions for you if you become incapacitated.
4. ADDED EXPENSE
Creating an estate plan can save money! In many cases, dying without an estate plan is far more expensive than dying with one. Not only can advance planning allow for opportunities to minimize estate taxes, but it can also minimize other types of taxes-including property tax and capital gains. For those transferring assets to a spouse or children, careful planning can ensure that those beneficiaries receive the maximum benefit from your gift. Additionally, creating a trust can avoid the cost of probate..
Effective estate planning involves complex strategies to protect your assets and minimize adverse tax consequences. Failing to have your estate plan prepared by an experienced estate planning attorney, who knows how to work together with your other financial and insurance professionals, increases the risk of otherwise avoidable expense.
5. FAMILY CONFLICT
Preparing an estate plan will help reduce family conflict. Having an estate plan doesn't guarantee no one will fight about your decisions over who gets what and how much. However, it can significantly diminish the odds of anyone contesting and can help ensure that your assets are distributed according to your wishes.
For more information about Wills and Trusts as well as Durable Powers of Attorney, Medical Directives, and other Estate Planning essentials, contact the lawyers at Family Security Law Group, serving families throughout the State of California. Visit their website at: www.familysecuritylawgroup.com. Or call them at 805-496-4681.