Planning ahead will avoid chaos for your loved ones and will also make certain that your wishes are honored upon your passing or if you become incapacitated. Unfortunately, many people do not take advantage of these opportunities and in turn their estates are left in the hands of the courts and their family is left with greater responsibilities and turmoil during a time when they are already experiencing sadness and distress. The following are common myths regarding estate and elder planning that prevent people from taking the necessary steps:
MYTH: Only the wealthy need to plan.
TRUTH: An estate or elder plan is necessary regardless of your net worth. Planning ahead will make the process of sorting out your estate easier for your loved ones upon your passing. Estate and elder planning can also include documents to ensure that your financial and health care decisions will be handled properly in the event you become incapacitated. Having these plans put in place ahead of time will be beneficial to everyone, not just the wealthy.
MYTH: Estate planning is only necessary for the elderly.
TRUTH: Anything can happen to anyone at any given time. Every day people become ill or suffer trauma or even die – even those who were young or perfectly healthy. It is better to prepare for this unfortunate possibility than to risk leaving your loved ones in a state of chaos should something like this happen to you. Without the proper plan put in place, they will be left to go through all of the long term health care issues and eventually the court system during an already difficult and emotional time.
MYTH: A simple Will is all you need.
TRUTH: Although a Will provides the courts with guidance, it does not eliminate probate. Having a Will probated in court can take a very long time and incur high costs. Taking more in-depth planning measures will make the process simpler for your loved ones.
MYTH: An estate plan is not necessary because my spouse will inherit everything.
TRUTH: Depending on how your assets are titled and the current state laws, this may not be true. Additionally, even if your assets are held jointly they may be exposed to estate and gift taxes.
MYTH: Creating a living trust takes away control of one’s assets.
TRUTH: If your trust is created properly, you will still have the power to do anything you would like with your assets while you are living and avoid probate when you pass away. Creating a trust will also ensure that your assets are under control and handled how you would like them to be upon your passing and not left in the hands of a judge.
MYTH: I do not need a lawyer to create my estate or elder plan.
TRUTH: This may be an option for some relatively ‘simple’ health care decisions. There are resources such as the Five Wishes, which can help you create a health care directive. However, in order to optimize your estate or elder plan and ensure that everything is done accurately and to your exact wishes, it is best to consult an experienced attorney. Complicated issues that you did not initially expect may arise. It is a good idea to seek legal advice from an attorney who specializes in the area of estate planning to make sure that all of your affairs are in proper order.
MYTH: I do not have to worry about what happens to my estate when I die because my family will make the right decisions.
TRUTH: During this difficult time, it will be helpful for your family to have your guidance. Your wishes regarding your estate should be legally documented as to avoid any confusion or unnecessary conflict within your family as they attempt to handle your estate on their own.