Dear Angel,
I read somewhere that this week is National Estate Planning Awareness Week. How can I convince my family and friends that they need an estate plan?
Thanks for your help!
Planna Head
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Dear Planna,
Nearly 56 percent of all Americans do not have an up-to-date estate plan. And 40 percent of Americans don’t think they have enough assets to create an estate plan at all, according to Caring.com’s 2024 Wills Survey. National Estate Planning Awareness Week, which occurs this week (the third week in October each year), was adopted in 2008 to help the public understand what estate planning is and its importance.
National Estate Planning Week is a time to educate yourself and others on the need for an estate plan. While an estate plan can’t prevent death or illness, it can protect your family from stress and emotional fallout once you’re gone. If you die without an estate plan, your legacy is left to your state’s intestacy laws and the nightmare of probate. If you become incapacitated (for example, from a stroke – see today’s main article – without an incapacity plan (which is part of every good estate plan), then your estate is subject to the nightmare of lifetime probate, where the court appoints a conservator or financial guardian to manage all of your financial affairs for so long as you remain incapacitated, which is often for the rest of your life.
Planning is Important for all Ages and Stages
Once you are in the stage of life where you own any assets, no matter how few, you need an Estate Plan (usually using a living trust to avoid the nightmare of after-death probate) that will ensure that what you own is distributed upon your death to the beneficiaries you desire. An Estate Plan will not only preserve your legacy but can also help to avert family disputes once you are gone.
By planning in advance, you can retain the assets it has taken you a lifetime to accumulate and the peace of mind that your family’s needs will be adequately and properly addressed.
What Does an Estate Plan Include?
Every adult, in every stage of life, should at least have an estate plan comprised of a General Power of Attorney and an Advance Medical Directive with a Long-term Care Directive.
Estate Planning attorneys help their clients by preparing legal documents such as wills, living trusts, beneficiary designations, powers of attorney, charitable trusts and life insurance trusts, and much more. Good Estate Planning attorneys also want to ensure their clients have appropriate life insurance and long-term care insurance (or other good long-term care planning, such as with a special type of irrevocable trust) in place, as these types of insurance are often an integral part of a good estate plan.
What Happens to your Estate if You Don’t Plan Ahead?
If you die without a Last Will, or with a Last Will but without a funded trust, the probate court will oversee distribution of your property. Probate is a lengthy, public, and expensive process, fraught with many complexities. To try to explain it simply, the after-death probate process involves: proving the authenticity of your will (if you had one); appointing a personal representative (either an executor nominated in your Last Will and Testament or an individual asking to be appointed as the administrator of your intestate estate, which can result in many people fighting over who gets to serve in that role); identifying and inventorying your assets; paying your debts and taxes; identifying your legal heirs (the people who would inherit your property if you died without a Will); and eventually, after everything else is done, distributing property according to your Will or, if you died intestate, according to state law. Most people think of probate as something that happens only after death. And many people believe that a Last Will and Testament avoids probate. Both of these are very unfortunate misconceptions. Probate can occur after your death if you die without a Will or a trust (also called dying intestate); or after you die with a Will as your only or primary Estate Planning tool, and there are assets solely in your name that do not have a joint owner or a named beneficiary.
Also, without a properly drafted and comprehensive Incapacity Plan, if you ever become incapacitated, someone will have to petition the court to have you declared incompetent and become your legal guardian and conservator. Once a person is appointed as your conservator (sometimes called a financial guardian), that person will be required to hold your assets as part of a court-supervised “lifetime probate,” a process that is typically identical to the nightmare of probate that happens after death when a Will goes through probate or when someone dies without a Will – detailed record-keeping, dreaded annual accountings, and all the other complications, hassles, and expenses of after-death probate. But with “living probate,” your conservator has to do all this work for the rest of your life. A simple and inexpensive Incapacity Plan, prepared by an experienced Elder Law and Estate Planning attorney such as those at the Farr Law Firm, will eliminate the need for living probate by naming people you trust to make legal and financial and medical decisions for you.
To get your estate planning in order, please contact the Farr Law Firm when you are ready.
Hope this helps!
Angel
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