Top Five Estate Concerns and Death & Disputes
Top Five Estate Concerns
If you think estate planning is for the wealthy, think again. Everyone has an estate worth planning; some are just more complex than others. Facing your own mortality can be uncomfortable, but ignoring the inevitable can cause unnecessary pain and conflict for your loved ones. In this article, we’ll review the top five concerns when considering your estate plan.
#1 Incapacity Issues
If you became incapacitated, who would make decisions on your behalf? If you’re married, you’d probably guess your spouse. If you’re at least eighteen years of age and living at home, you’d probably say your parents. Both answers are incorrect.
#2 Minor Children Matters
Consider how you’d feel upon hearing the story of children abandoned by their parents. After the shock, you might reflect on how much you love your own children. You nurture them. You impart morals and values. You search for just the right babysitter. However, if you die prematurely without a plan in place, your children will be in the same predicament – orphaned, with their fate determined by the court.
#3 Death & Taxes
When it comes to transferring possessions upon your death, you can either make it easy on loved ones through proper estate planning, or you can leave it up to the court system. Prior planning is the more efficient and effective option. There are a variety of planning methods to accomplish this transfer. For example, Revocable Living Trusts are commonly used to transfer assets after death, independent of the legal system in many states.
#4 Inheritance Risks
Leaving an inheritance to provide for your heirs seems like a positive decision. However, the outcome may be far from what you intended if you haven’t considered the potential risks. What if that inheritance were squandered by a shortsighted eighteen-year-old on an expensive sports car, leaving the heir broke but fashionable? What about money left to a previously happy couple now engaged in a bitter divorce? What would happen if the heir were involved in a lawsuit or bankruptcy? Proper planning through one or more Long-Term Discretionary Trusts will protect and preserve an inheritance for generations to come.
#5 Procrastination Perils
Who wants to take time out from living to think about dying? Any raised hands? Probably not many. Yet each moment you procrastinate in preparing your estate increases the likelihood that those you leave behind will grieve not only your passing but your lack of planning as well. Dying without even a basic will, or with one that is outdated and no longer meets your needs, will tie your loved ones up in legal knots at a most vulnerable time in their lives.
Death & Disputes
“Never say you know a man until you have divided an inheritance with him.” – Johann Kaspar Lavater
Tangible Personal Property
Real estate and other investments may come to mind when considering the cause of family unrest. However, cash, antiques and heirloom jewelry top the list of items that fan the flames of many disagreements. The items in question don’t even have to be valuable. Sentimental trinkets can cause just as much, if not more, tension. Fortunately, the laws of most states provide a flexible solution for the specific distribution of tangible personal property.
Family Business Interests
Ninety percent of U.S. businesses are family-owned or family-controlled, yet only one-third survive their founders. Federal estate taxes are one reason for this dismal survival record, but family feuds are also to blame. By carefully coordinating your personal estate and business succession planning, these issues can be resolved before they arise.
For many people, the subject of death is not easy to discuss. If you are planning your estate, broach the topic with your heirs. A recent survey, conducted by the AARP/Scudder Investment Program, found that the majority of respondents who reported no conflicts over an inheritance had known what to expect and believed their inheritance was fair.
This publication does not constitute legal, accounting or other professional advice. Although it is intended to be accurate, neither the publisher nor any other party assumes liability for loss or damage due to reliance on this material.
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