Who needs an estate plan? Everyone. But a lot of people avoid estate planning due to various excuses. Here are the top excuses used to avoid planning and why it’s important to plan anyway.
What is an Estate Plan?
Estate planning is the process of mapping out how your property and assets will be divided in the event of your death. An effective estate plan typically addresses who will inherit your assets and seeks to minimize the tax burden for those who inherit your assets.
Whether you’re an individual or a business owner, it’s an important step to take to ensure financial security for loved ones. Making an excuse to start one? Here are some common excuses and why they don’t hold water.
I Don’t Have Enough Assets
While you may not feel like you have a lot of assets, people need to remember that real estate, cars, jewelry, and family heirlooms all have value. Digital assets, like frequent flyer points, credit card rewards, and income-generating websites, are new but should also be considered. With an estate plan in place, these are assets that could be distributed to people you want to have them.
If you don’t have an estate plan, the state where you reside at your death has a plan for you. This means without a plan, you allow a judge who doesn’t know you, to apply the law and distributer assets that you have worked for in a way that you may not want. Regardless of what you think, you do have assets that will be passed on after you’re gone. If you want them to go to certain people, it’s best to make a plan.
I’m Too Busy to Make One
Even if you’re busy, busy people still need to plan for the future. Focusing on how busy life is now is common, but if you just spend a few hours of your time now, you could save your family months or years of frustration later. Working with a professional well-versed in estate tax planning strategies can also help you weigh your options and find the optimal strategy to transfer wealth while minimizing taxes.
I’m Too Young for an Estate Plan
If you feel good and are in excellent health, you may wonder why you need an estate plan now. It could be decades before your estate plan will be needed. Why worry, plan, and pay for something that won’t be touched for 10, 20…maybe 40 years?
The bottom line of it all: your estate plan will eventually be used. It’s not a question of it but of when. And we aren’t guaranteed the next ten years, year, or even day. Why gamble with your family’s security when you can quickly and easily create a plan that will ensure everything is in place for when you go?
Once I’m Gone, I’m Gone – What Does it Matter?
It’s understandable – when you’re gone, earthly matters don’t concern you anymore. So why make an estate plan anyway? But the last thing you want is to make your death harder for the people who were in your life.
While you may be gone, your loved ones will likely be around. Instead of having to leave them to deal with taxes, asset distribution, and the probate process, you can ensure they don’t have to deal with any complications during a time of loss.
If you own a business, that will also stick around despite you being gone. Have you considered the best plan for the business once you pass? If you plan to keep it in the family, consider creating a structure that makes it easier to transfer the business’s assets to other family members. If you want to pass it to someone else, an estate plan can help make the transfer process easier for them too. There are many options to consider. Your tax professional can help you select one that is appropriate for you in light of your specific situation.
Let Gaylor Tax Services help navigate the estate planning process with you.
Let’s Create Your Estate Plan
Estate planning can seem intimidating. But at Gaylor Tax Services, we’ll help navigate the process with you. Our experts are here to answer your questions and guide you through the complex and shifting tax laws to facilitate the transfer of assets to minimize tax liabilities of your tax beneficiaries. No matter what, don’t hesitate to contact us. We are located in Phoenix, Arizona but can assist you anywhere in the state.