Short answer – yes, you do! There is a misconception that estate planning is only for the extremely wealthy and its only purpose is to avoid estate taxes. But the truth is that having an estate plan does a lot more than that, no matter how much you have in the bank.
Most of my clients begin our discussion with “I want to make sure my kids are taken of.” If you die without a will, a judge will decide who will raise your kids. There aren’t many people who want to put this decision in the hands of a stranger. Every family is unique – but all parents have strong feelings on this subject. They want the loving and responsible aunt, or brother, or best friend for this big job – NOT the nutty sibling (and let’s be honest, there’s always one) who barely knows the kids. If you take the time to sign a will, you can choose the guardian for your children.
Long Term Planning.
After guardianship, the biggest concern for my clients is that there is someone managing assets for their kids. Most parents agree they don’t want their 20 year old having free reign with whatever they would inherit. A little bit of planning ensures that you can name an individual to manage assets for the benefit of your children (and make sure they use the money to pay for college tuition as opposed to, say, a fancy Porshe) as they mature into the responsible adults we anticipate they will become.
Determining Where Your Assets Go.
If you don’t have a will, state statute creates one for you. Whether you have $10,000 or $10,000,000 in your bank account, odds are you want to be the one to decide how to distribute it upon your death. Having an estate plan in place gives you the ability to do just that.
It’s Not Just About the Kids.
Somewhat surprisingly, not everything is about our kids. An estate plan gives you the ability to name someone to make financial and health care decisions for you if you are unable to do so during your life and to make your final wishes known.
Avoiding Confusion and Contention.
Even the most “perfect” seeming families have the potential for drama. Try to imagine your extended family figuring out who should be in charge of your kids or who should manage your estate. No one wants this for their families or for their children. As difficult as it seems to talk through these things, it is better for you to make these decisions so there is a clear and definitive plan.
An estate plan is essential for everyone. Trust – Estate Planning for New Families can help make the process as easy as possible!