What means the most to you in life? Is it your family, health, home, business, or something else entirely? All of them? Okay, great. Whatever it is, you’ve worked hard for it and want to protect it. For most people, though, family comes first. And as such, we’re keen to ensure our loved ones are set financially if or when something happens to us.
Estate planning ensures your assets and property are distributed according to your wishes when you die – or, in the case of some types of trusts, even while you’re alive. As such, if you live in Tennessee, it would be advisable to find the best estate planning attorney in Franklin to help fine-tune your plans so that everything goes as smoothly as possible. And if you’re wondering why you should consider planning your estate, here are four great reasons:
1. To Protect Your Family
Most of us don’t like to think about the finality and inevitability of death. But the sad truth is that no one is immortal; sooner or later, we’ll shuffle off this mortal coil.
Now, if you’re your family’s sole breadwinner, what will happen to them when you’re gone? How will they manage financially? Thankfully, by putting clear-cut plans and directives in place, you can ensure your loved ones have an easy time afterward.
You can also designate a guardian for your minor children and set up powers of attorney in case you become incapacitated. Taking these steps now can save your loved ones from having to make difficult decisions during a time of grieving. By planning ahead, you can give your family the best possible chance for success after you’re gone.
2. To Lower Transfer Taxes
Do you like taxes? Neither do we. Unfortunately, taxes are a necessary evil. And when it comes to estate taxes, you know the Internal Revenue Service will want their cut when you die – it seems like there’s no respite, even in death.
But, with proper estate planning, your loved ones don’t have to bear the brunt of a large transfer tax bill. In short, a well-drafted estate plan can reduce their tax burden, so your family keeps more of your assets. By so doing, they can have more financial security. For instance, proper estate planning can help you;
- Take advantage of tax breaks and deductions.
- Structure your assets to minimize the amount of taxes payable.
- Avoid taxes altogether in some cases
A knowledgeable estate planning attorney can help you devise a strategy to take full advantage of these opportunities and minimize the tax burden. Thus, take the smart approach by talking to your trusted legal professional.
3. To Avoid Probate
Probate is the legal process of administering and settling a deceased person’s estate. And, unfortunately, it can be a pain – especially if you have a large estate.
Probate can take months or even years to complete; during that time, your loved ones won’t have access to your assets. In addition, it can be costly, with expenses eating into the value of your estate. And, to top it all off, the probate process is public, so your family will have to deal with prying eyes, nosy neighbors – the list goes on. Well, being in the public limelight isn’t the ideal situation during a time of grieving, right?
You can avoid probate in various ways. For instance, by setting up a trust, you can ensure your assets are distributed accordingly without going through probate. Similarly, designating a beneficiary on key assets, such as life insurance policies and retirement accounts, can help you steer clear of the probate process.
4. To Protect Your Interests
What would happen if you suddenly become incapacitated? Who would make decisions on your behalf?
If you don’t have a plan in place, the court will appoint a guardian to make decisions for you – and that person may not be someone you have in mind. With estate planning, you can ensure the people you trust are making decisions for you if you cannot.
For instance, you can set up a durable power of attorney. This document appoints someone to handle your financial affairs should the unfortunate happen. Similarly, you can create a healthcare directive, which designates someone to make medical decisions on your behalf. As a result, if you cannot make decisions for yourself, you can rest assured the people you trust will take care of you.
Estate planning goes hand in hand with financial planning – you can’t have one without the other, especially if you want to protect your family and your assets. By taking the time to plan, you won’t have cause for alarm down the road. Hence, don’t wait until it’s too late – start the process early to avoid potential issues later.
