The Importance of Estate Planning

Introduction

While the idea of estate planning makes some people feel uneasy, it is important not just for yourself, but also the loved ones you will leave behind. There are many benefits to estate planning. Three (and a half) of the most important are discussed in this blog.

1.      Ensure your wishes are followed

A will is a document that determines what will happen with your estate after you pass. Your estate is made up of all of your property, assets, liabilities, etc. A will can also establish what happens with the custody of your children or pets if you pass. If you do not have a valid will in place when you pass, your estate will be disbursed according to legislation, which likely will not reflect your intentions.

2.      Reduce estate administration costs

When you pass, your estate must be administered. Administration is the settling of all of your estate’s assets and liabilities – some of which must be probated through the court. The court charges a percentage fee-based percent based on the value of the assets being probated. Estate planning can minimize the amount of assets that must be probated, thereby minimizing estate administration costs. Estate planning can be used to structure your estate to limit what assets must be probated, thereby reducing estate administration costs.

3.      Avoid disputes

While no one anticipates them, disputes can arise between a deceased’s beneficiaries. Having a will allows you to clearly set out your testamentary wishes to minimize the likelihood of a dispute. Additionally, if a dispute does arise, a will provides the court with a guide to interpret the deceased’s intentions.

P.S. Review and update your will regularly

Life changes, like the birth a child or the purchase of a home, can affect your existing will. It is important to regularly review your will and have it updated when necessary.

Conclusion

Many people put off estate planning because they believe their estate is simple and they don’t need a will, the topic makes them uncomfortable, or a variety of other reasons. However, some basic estate planning goes a long way towards avoiding potential disputes and administrative costs in the future.

Contact Spencer today about preparing your will.