Wealth is Not Required for Estate Planning
July 26, 2013
One of the common misconceptions people have about estate planning is the idea that you have to be wealthy to execute an estate plan, or that an estate plan is not worth while unless you have accumulated a lot of wealth. Although wealthy individuals can take advantage of certain estate planning tools and strategies, those who are not as wealthy can also benefit greatly by setting up an effective estate plan.
What You Own, Not How Much You Own
Do not mistake a small estate with no estate. Although most people in society are not millionaires, most people own something, whether it is a car, a house, bank accounts, retirement accounts, jewelry, or other personal possessions. The beauty of estate planning is its adaptability to help any person decide how to protect and pass on whatever that person owns. Think of estate planning as the means to making sure that what you do have is taken care of the way you want it, regardless of how much you have. If you do not do any estate planning, you are essentially handing over your estate to the probate courts to decide how to distribute your assets upon your death, and the way the state decides it will likely be different from what you want.
Assets Aren’t the Only Things
Another reason estate planning is important for every person is because it protects much more than your assets. For example, what happens to you if you become incapacitated and are unable to make your own healthcare decisions? What happens to your kids if you unexpectedly pass way? Who is going to take care of them? These are just a couple of examples of how estate planning is important for everyone, not just the wealthy. With effective estate planning, you can execute a health power of attorney or a living will, which will ensure in the event of your incapacitation, that health care decisions are decided how you want. Further, an estate plan will allow you to name a guardian to take care of your children in the event that you pass away or are otherwise unable to do so. Nothing would seem more tragic than for someone to get in an accident and have little or no control over their own health or the well-being of their children.
When it comes to your life’s work, whether it be your wealth, your family, or your own well-being, you do not want to leave anything to chance. Whether you own a little or whether you own a lot, you need to execute an effective estate plan. Doing so will protect and give you control over all of the important things in your life you have worked so hard for.