Estate Planning Myths and Misconceptions
Most people recognize the importance of estate planning; however, those same people often fall victim to the numerous and varied myths and misconceptions about estate planning. To help ensure that you, your family, and your assets are protected, the Loveland area estate planning attorneys at Zimmer Law Firm discuss common estate planning myths and misconceptions.
“I Don’t Need an Estate Plan Yet”
One of the biggest estate planning myths is the idea that you need to reach a certain point in your life, or you need to achieve a certain material success before the need for an estate plan really kicks in. While it is true that as your family and your estate grow, you will need to build on your basic estate plan to accommodate that growth, every adult should have at least a basic estate plan in place. A basic plan, usually consisting of a Last Will and Testament and one or two other estate planning documents, prevents you from leaving behind an intestate estate should something happen to you. It also allows you to decide who will oversee the probate of your estate and provides you with the only official opportunity available to let a judge know whom you would want to be the guardian for your minor children if one is ever needed.
“I’m Too Young to Worry about Incapacity”
Incapacity is not limited to old age. You stand a one in five chance of suffering a period of disability lasting five months or more prior to reaching retirement age. If you do suffer a period of incapacity, who will make personal and healthcare decisions for you? Who will take over control of your assets and finances? Absent an incapacity plan a judge may be the one answering those questions – and you may not like the answers.
“I Should Appoint Close Friends or Family Members to Fiduciary Positions”
Throughout your estate plan, you will likely have several opportunities to appoint people to fiduciary positions. The Executor of your estate, the Trustee of a trust, and an Agent in a Power of Attorney are all examples of fiduciary positions. While your initial thought may be to appoint a spouse, friend, or family member to one of these positions based solely on the fact that you trust that person, take some time to think about the duties and responsibilities of the position before making your final choice. Fiduciary positions often require legal and financial knowledge and experience that a spouse/friend/family member doesn’t have, making them a poor choice for the position after careful thought.
“I Should Keep the Details of My Estate Plan to Myself”
Sometimes it is wise to keep your estate plan details to yourself; however, when beneficiaries and/or heirs are surprised about the terms of an estate plan, their first reaction is often to contest the Will or otherwise initiate litigation. Discussing the basic terms of your plan with loved ones is one way to decrease the likelihood of disputes during the probate of your estate. Drafting a “Letter of Instruction” is another option. A Letter of Instructions is simply a letter that you include with your estate plan that includes additional information not found elsewhere in your plan. In this case, the letter might offer explanations for the decisions you made in your estate plan, making litigation less likely.
“I Have an Estate Plan So I Don’t Need to Worry About It Anymore”
As your life changes, so should your estate plan. As you grow and change, so should your plan. During your working years, you should routinely review and revise your estate plan every three to five years. Once you retire you can stretch that to every five to eight years. Certain life events also call for a more immediate revision of your estate plan. Marriage or divorce, for example, should prompt an immediate update to your plan as should things such as retirement, a move to a new state, the birth of a child, or the death of a fiduciary.
Contact a Loveland Estate Planning Attorney
For more information, please join us for an upcoming FREE webinar. If you have additional questions or concerns about estate planning, or you are ready to get started on your plan, contact the experienced Loveland area estate planning attorneys at Zimmer Law Firm by calling 513-721-1513 to schedule your appointment today.