3 myths about estate planning
There are a variety of reasons that people use to avoid estate planning. To put it off or get out of doing it altogether, they tell themselves all sorts of “lies” such as “I’m not rich, so why do I need an estate plan?” Or, better yet, “If I make a will, I’m going to die.”
Some common myths about estate planning include:
I don’t need a will because I’m not wealthy enough, sick, or old
Even if you don’t have a lot of assets, you want whatever assets you have to pass on to the people of your choosing. And, you want to have a will in order to protect your family. For example, in your will you’ll want to name a guardian for your children if you should pass away, and you can outline the manner in which you’d like your body to be handled after you’ve died so you’re not leaving your loved ones in the dark.
I don’t need to update my estate plan because nothing has changed
This is one of the most common mistakes people make when thinking about their estate plans. If you fall ill and die with outdated, incomplete, or unsigned documents, you may very well be leaving your family unprotected when it comes to the misuse, squandering, or mismanagement of assets. Executors, guardians, and/or trustees that your originally chose may no longer be able to perform those duties.
Therefore, reviewing and updating your estate plan should be done at least every four years or as often as significant events occur in your life such as a change in your marital status, the birth, death, or disability of a child, or the death of a beneficiary.
I don’t need to update beneficiary forms because I have a will
Your will only controls assets that pass through probate estate, but many assets pass by contract or operation of law. Examples include IRA accounts that pass by beneficiary forms which, in general, will supersede your will.
Continuing to believe in the myths about estate planning can really hurt your family and other loved ones in the long run. The truth is that everyone needs an estate plan in order to ensure that their estate will be distributed according to their wishes once they pass.
A living trust is a document through which your assets are placed into a trust for your benefit during your lifetime and then are transferred to your named beneficiaries at the time of your death by a representative of your choice, a successor trustee.
With a living trust, you’re looking out for your family’s best interests because it avoids probate, it provides privacy, and it may save you money.
Enlisting the services of a qualified estate planning attorney can help you deal with complex family and/or financial situations, so your situation doesn’t become one of those probate court nightmare stories.
At the Law Office of David W. Foley, estate planning attorney in San Diego, we specialize in creating living trusts as part of your estate plan.Schedule your FREE Consultation