In building your financial legacy, you have created an estate you will one day leave behind - An estate someone will ultimately need to settle. While there is no escaping death or taxes, you can plan for both. Last week we discussed challenges you can face during your life - this week we turn to why it is important after you pass.
An Act of Love
Recent data suggests the pandemic has spurred an uptick in estate planning, especially among younger adults. This is the good news. But still, an enormous divide remains:
Some 60% of Americans agreed it is important to have a will.
But, as of December 2020, only about a third of them actually had one.
Among those without a will, the top reason cited across multiple years remained the same:
“I haven’t gotten around to it.”
This is not surprising given the logistical and emotional stumbling blocks involved. Most families are plenty busy with more immediate concerns … Right up until they are not.
All the Reasons You Need
You are not alone in procrastinating on making your estate plan. But regardless of your age or net worth, remember: a well-structured estate plan is the greatest gift you can leave to your loved ones to reduce their stress during an already stressful time.
According to a 2018 EstateExec survey, it typically takes just under 700 hours to settle an estate valued between $1–$5 million. Anything you can take care of in advance will be one more gift you leave behind, granting your loved ones more space to grieve.
Estate planning also brings these important practical advantages to nearly every family:
- Clarity: Your wishes will be better respected if you write them down and make them legally binding.
- Speed: Your estate will settle quickly with less red tape and fewer frustrating delays.
- Cost Savings: The faster the settlement, the less it costs.
- Tax Benefits: You and your heirs can enjoy a more tax-efficient wealth transfer.
Protection: You can keep distributions out of the wrong hands, such as estranged family members or debt collectors.
One Step at a Time
What’s stopping you from putting an estate plan in place? In our next post, we will take you through the three common hurdles that stand between you and your effective estate planning. These include: (1) deciding who gets what, (2) making it legal, and (3) getting (and remaining) organized.
How can we help?
We hope we have clarified the role these critical protections can play during crucial moments. That said, professional legal counsel is usually warranted as you sort through the details. Let us help. That’s what we are here for!