We all know that passing away is one of the two certainties of life, but in spite of this, the majority of American adults are not properly prepared from an estate planning perspective. A lot of people fail to act because they really don’t know why estate planning is important. Let’s look at three things that you should know about estate planning. When you digest this information, you will understand why estate planning is essential. Our Ashland estate planning attorney can provide the assistance you need to get started.
Everything doesn’t automatically work itself out
You may assume that there are laws on the books that will come into play if you pass away without any estate plan. The government will make sure that everyone that you love is properly provided for, right? In fact, if you die without a will or some other estate planning document like a trust, the condition of intestacy will result. Once your final debts are paid, the state will indeed determine who gets what. However, people that you love may be disinherited, because these laws are quite simplistic. When you plan your estate properly, with the help of our Ashland estate planning attorney, you can be certain that your own true wishes are carried out.
Estate planning is relevant to young people
We all hear about people passing away at young ages each and every day. You never know what the future holds, and you cannot be certain that you will have time to plan your estate as a senior citizen. As soon as you are a self-supporting, responsible adult, you should have an estate plan in place. This is true for single people, but if you are married, or if you are a parent, estate planning is an absolute must.
A will is not the only option
Many people equate the process of estate planning to the creation of a last will. In fact, a will is not the best choice for many people. If you use a standard last will to state your final wishes, the inheritors would receive lump-sum inheritances. Everyone is not a good money manager, and this can be disconcerting if you have a spendthrift in the family. To respond to this, you could create a revocable living trust and use the trust as the centerpiece of your estate plan instead of a will. You do not lose control of the assets while you are living, so you do not have to be concerned on that level. A living trust is one option, but there are many different tools in the estate planning toolkit. You should explore the possibilities and make fully informed decisions.
Benefits of a living trust
When you use a last will as your asset transfer vehicle, you would be allowing for the distribution of lump-sum inheritances to the inheritors. This can be a source of concern if you have someone in the family who is not great at handling money. To make sure that this individual would have resources to draw from over the long haul, you could create a living trust. While you are alive and well, you could act as the trustee and the beneficiary, so you would continue to control the assets.
Naming a successor trustee
You name a successor trustee to take over the trust administration duties after you are gone, and you name a successor beneficiary. It is possible to name an individual that you know personally to act as the trustee, but many people will use a professional fiduciary such as a trust company. In the trust declaration, you can leave behind specific instructions about the way you want the assets to be distributed to the successor beneficiary. For example, you can instruct the trustee to distribute a certain amount each month.
Planning for capacity, as well
Another advantage that you gain with a revocable living trust is the ability to account for incapacity. Unfortunately, many elders become unable to handle their own finances eventually, with Alzheimer’s disease being a leading culprit. In the trust declaration, you could empower a disability trustee to administer the trust in the event of your incapacitation.
Join us for a FREE seminar today! If you have questions regarding wills and trusts or any other estate planning matters, please contact the experienced attorneys at the Potter Law Firm for a consultation. You can contact us either online or by calling us at (606) 324-5516 (Ashland, KY), (859-372-6655 (Florence, KY), or (704) 944-3245 (Charlotte, NC). We are here to help!