Dispelling Estate Planning Myths
Jan. 24, 2023
Most people associate the term “estate planning” with death and one's mortality, which is probably why so many people put off creating an estate plan until they reach a certain age or fall seriously ill.
Equating estate planning with death is one of the many myths surrounding the process, right along with thinking that you don’t own enough assets to worry about such planning and another myth that you can simply let your family decide who gets what when you die.
At Moses Estate Planning, PLLC, we are acutely aware of the many inaccurate concepts about estate planning. We hear many of these from many of our clients throughout Kootenai County and Coeur d’Alene, Idaho, and Los Angeles, California. Our job is to set the record straight and help you create an estate plan that aligns with your needs, your wishes and goals, and the law.
Common Estate Planning Myths
The following explores some of the most common estate planning myths and the truth that debunks them.
An estate plan only addresses what happens after I die.
Comprehensive estate plans benefit you while you are alive as well as protect your legacy when you die. In this day and age, when people live longer even as their health fails, estate plans are invaluable. Powers of attorney for healthcare, durable powers of attorney, living wills, and living trusts can provide for your financial well-being even if you are no longer mentally capable of making your own decisions are all estate planning tools you can use. If you don't decide who you want to make health care and financial decisions for you, somebody else (or a court!) will. The sooner you execute your estate planning documents, the better.
Using online estate planning forms is just as good as hiring an attorney.
The digital age has made a plethora of fill-in-the-blank online estate planning tools available to the masses. Anything so personal designed for “the masses” is problematic. DIY estate planning templates do not always comply with state laws, are not tailored to the unique situation of an individual, and can be a nightmare to keep updated. If you change one thing in one document, it needs to be changed uniformly throughout all the documents. If you fail to do so, every estate planning document can be challenged in court. Lastly, many of the online platforms do not take "funding" into account, which is the process of placing (titling) one's assets into a revocable living trust.
A skilled estate planning attorney knows how to construct congruent, enforceable, and comprehensive documents. Moreover, copies maintained by your attorney will help eliminate confusion over current documents versus revoked ones, as well as provide a backup if your documents cannot be located when they are needed.
If I die without a will, my family will just decide who gets what.
If you die without a will or trust (dying intestate), the probate court will decide what happens to your assets and your debts. Once your debts are satisfied, the court will distribute the rest of your estate according to the law of intestate succession. If you did not want one of your children or the spouse you were considering divorcing at the time of your death to get a piece of your estate, these wishes won’t be followed unless you put an estate plan in place.
Moreover, if you wanted someone to serve as the guardian of your minor child after you die, or if you wanted a certain person to be the executor (person-in-charge) of your estate, you need to name that person as such in your will or your trust documents. Otherwise, the decision is left entirely to the court. So, you see, only two entities can decide what happens to your estate when you die. It can be the court. Or it can be you.
If I have a will, my estate doesn’t need to go through probate.
Wills do have to go through the probate process. Wills must be validated by the court, creditors can file claims against the assets of your estate, and disgruntled heirs can challenge the validity of a will. That said, drafting a will can reduce the time and the drama of probate. Although the court must approve the person you have named as the executor in your will. In most cases, that person will be able to administer your estate pursuant to your wishes with little oversight of the court.
Your estate planning attorney can advise you on ways you can avoid probate. For example, you could create a trust (revocable living trust or irrevocable trust depending on your circumstances). Your attorney can also advise you on which assets can be left to named beneficiaries without being subject to probate. If avoiding probate is one of your goals, it's in your best interest to work with an experienced estate planning attorney.
Estate planning isn’t necessary until I retire or get sick.
Simply put, every adult should have at least a basic estate plan. Estate planning is not only for the wealthy, the elderly, or the terminally ill. Since you don’t know when you will die or become incapacitated, the earlier you develop an estate plan, the better.
Once I create an estate plan, I’m done with it.
Estate plans comprise living, breathing documents. They need to reflect the changes in your life as you experience them. Keeping them up to date is crucial.
Marriages, divorces, the birth or death of children, the acquisition or loss of assets, and changes in your health status are just a few of the life events that need to be reflected in your estate plan. Working with an estate planning attorney to keep your plan current is one of the best decisions you can make for yourself and the future of your legacy. Plus, your attorney will know how one change affects other documents in your estate plan so that every piece will remain consistent.
Take the Right Steps
The best way you can make your future wishes clear and enforceable is to work with an experienced estate planning attorney. At Moses Estate Planning, PLLC, we are here for our clients in Coeur d’Alene, Idaho, and Los Angeles, California now and throughout the life of their estate plan.
Let us help you create or update your estate plan. Call our team today at Moses Estate Planning, PLLC, to schedule a time to talk about yours.