Contrary to popular belief, estate planning is not just for the super wealthy, as almost everyone can benefit from having an estate plan in place. But what exactly is an estate plan? And what happens if you don’t have one?
Simply stated, estate planning is expressing your desires in the event of your incapacity or death. At its core, a well-crafted estate plan provides the framework to answer two basic questions: (1) What happens if you become incapacitated and cannot make decisions about your finances and health, and (2) what happens to your belongings when you die?
Incapacity is when you have a physical or mental inability to manage your affairs. Incapacity can result from any number of misfortunes, including accidents, illness, or as part of the aging process. Who will take care of your finances while you are incapacitated? Who will make health care decisions for you if you can’t communicate with medical professionals? Who will make end-of-life decisions on your behalf?
Without an appropriate estate plan, your loved ones may have to file a legal action to take care of these issues for you. Your loved ones will be forced to navigate through the legal process which can take time and be costly. A very public example of not having an estate plan in place is the case of the late pop superstar, Prince. Without a will, his death has proven to be quite challenging for all involved. Read more about his estate battle here.
Estate planning lawyers use a variety of tools to avoid the time and expense of filing a legal action to take care of your needs in the event of your incapacity. Prior to any tragic event, you can decide who you want handling your financial affairs. This will enable that person to immediately handle your financial issues without the delay of going to court.
A properly drafted estate plan will also allow you to name a person to make health care decisions for you. The plan will also express your desires with respect to what kind of care you would like to receive in the event of your incapacity. The estate plan will also allow you to make end-of-life decisions, thus relieving your loved ones of having to make those difficult decisions.
If you die without an estate plan, what happens to your belongings? If you pass away without an appropriate estate plan, state law will determine who gets your belongings. This is known as dying “intestate.” When you die intestate, all decisions regarding disbursement of your property is made by someone else, and it usually occurs in probate court. While this ultimately may be how you want your assets to be given away, it may lead to unfortunate results, including:
- Certain heirlooms are given to relatives that do not appreciate them,
- Your assets may be given to someone you wanted to disinherit,
- An immature young adult may be given money that could be spent unwisely or frivolously,
- A financially irresponsible heir may receive money that will be immediately taken by their creditors,
- In some cases, a special needs beneficiary may be disqualified from governmental benefits because of their intestate inheritance
A proper estate plan removes the uncertainty of dying intestate. A well-drafted estate plan allows you to give what you have: (1) to whom you want, (2) the way you want, and (3) when you want.
At Ketlinski Law Office, PLLC, we help people that are worried or concerned about these issues. We use a variety of tools to accomplish your objectives in the event of your incapacity or death. Each person’s or family’s needs are different, and there is not a “cookie-cutter” solution that fits everyone’s needs. We take the time to get to know each client and understand what their desires are, before crafting a legal instrument to accomplish their goals.