Okay, friends, I’m here to answer the big-picture question. Exactly what is estate planning, and why is it so important?! It’s difficult to understand why you should invest in estate planning if you’re unsure what it is or why you need it. I’m going to talk through all of this in detail with as little legalese as possible.
I’ve written a blog post previously explaining Probate Law. That is more about the court process and proceedings after a person passes. However, this post is about what you can do now to make the probate process easier for your loved ones and ensure your assets are distributed according to your wishes.
If you read through this information and still have questions, please reach out through my contact form here on my website, I’m happy to answer any questions you may have. Or you can follow along on my Instagram and Facebook pages where I share tips, fun facts, and small glimpses into my life as a lawyer and mom.
I’m Amanda with Amanda Waltz Law and my most sought-after service is Estate Planning and Estate Administration. I’ve been a practicing attorney for over 9 years and started my own firm in Delphos, Ohio in 2021. I aim to serve my community’s legal needs with the utmost integrity and professionalism, all while maintaining approachability.
I’ve seen a lot of scenarios play out in various ways in my years as an attorney. Many probate situations could’ve been less costly or frustrating with a proper estate plan in place. However, every person’s circumstances are unique. There is not a one-size-fits-all type of estate plan coverage. So, let’s talk about what estate planning is and why it’s so important so you can better understand your personal estate planning needs.
What is Estate Planning?
Estate Planning is the process of planning how all of your assets, everything that you own and your wealth, will be distributed when you die. It typically involves creating a plan for how assets, such as property, investments, and other valuables, will be distributed to heirs or beneficiaries. Estate planning can include creating documents such as wills, trusts, and powers of attorney, which outline an individual’s wishes and preferences for how their assets are handled in the event of incapacity or death.
Who Needs Estate Planning?
Estate planning is not just for the wealthy or those with complex financial situations. It’s for everyone because everyone owns something. Whether it’s a vehicle, a bank account, a home, a boat, a piece of furniture, or jewelry, etc., it all goes to someone when you die. Regardless of the size of the estate, the amount of wealth, or even if there’s a lien on it, it will still go to somebody. Therefore, everyone should have an estate plan of some degree to ensure that their specific wishes for distributing assets after their death are known and carried out.
Here are some situations for whom estate planning may be particularly important:
- FAMILY DEPENDENTS: If you have a spouse, children, or other dependents that rely on you financially, estate planning can ensure that they are taken care of if something happens to you.
- BUSINESS OWNERS: If you own a business, estate planning can help guarantee that it continues to operate smoothly after your death and that your family receives the benefits of your hard work.
- WEALTHY: If you have a high net worth, estate planning can help minimize estate taxes and distribute your wealth according to your wishes.
- BLENDED FAMILIES: If you have a blended family, estate planning can help make sure that your assets are distributed to your loved ones in the way that you intend, even if you have children from multiple marriages or partners.
- SPECIAL NEEDS: If you have a loved one with special needs, estate planning can help assure that they are provided for financially and that their care will continue after your death.
Estate planning is essential for anyone who wants to protect their assets, ensure that their loved ones are taken care of after they are gone, and maintain control over how their assets are distributed.
Why is Estate Planning Important?
Estate planning is important for several reasons. I believe there are two main reasons at the top of this list.
First, it’s important to let both your heirs (all the loved ones in your life) and the court know what your intentions are with all of your assets upon your passing and how you want them distributed.
And secondly, it’s important because it makes the probate process easier on your loved ones and can help provide for them once you pass away.
Here are a few other important reasons to consider starting your estate plan:
- Minimizing Taxes: As briefly mentioned above, estate planning can help minimize estate taxes that may be imposed on your assets when they are transferred to your heirs. Proper planning can help reduce the amount of taxes that your estate will have to pay, leaving more for your beneficiaries.
- Avoiding Probate: Estate planning can help avoid the costly and time-consuming probate process. Probate is the legal process of administering an estate after someone dies. It can be lengthy and expensive and can tie up assets for months or even years. Proper estate planning can help minimize or avoid probate altogether. You can read more about how to avoid probate here.
- Protecting Assets: Estate planning can also help protect your assets from creditors, lawsuits, and other legal claims. By setting up trusts and other legal structures, you can ensure that your assets are protected and passed on to your loved ones.
Overall, estate planning is important because it allows you to protect and preserve your assets, maintain control over how they are distributed, and ensure that your loved ones are provided for after you are gone.
If you’re ready to begin your estate plan, reach out to me through my contact form or email today and we’ll take a look at your individual situation and estate planning needs together.