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Who Should Have an Estate Plan?

Who Should Have an Estate Plan?

Mar 27, 2025 | Estate Planning

If you are an adult, you need an estate plan. Regardless of age, financial status, or stage in life, having a plan in place ensures that your assets are distributed according to your wishes and that decisions about your healthcare and financial affairs are handled by someone you trust should you become unable to manage them yourself.

Key Takeaways

  • Every adult should have both an incapacity plan (for decision-making if they are unable to manage their own affairs) and an estate plan (to dictate asset distribution after passing).
  • A well-prepared incapacity plan allows you to designate trusted individuals to make medical and financial decisions on your behalf, avoiding court intervention and potential disputes.
  • Healthcare directives provide essential instructions for medical care if you are unable to communicate your preferences.
  • Clear instructions regarding asset distribution help prevent confusion and ensure your intentions are honored.
  • Consulting with an experienced estate planning attorney ensures that your plan is legally sound and tailored to your specific needs.

Understanding Estate Planning

Planning for the Future

Your estate consists of all the assets you own—such as your home, bank accounts, investments, personal belongings, and life insurance. While no one can take their possessions with them after passing, most people want to ensure that what they leave behind is distributed according to their wishes.

An estate plan provides legally binding instructions that specify who should receive your assets, what they should receive, and when they should receive it. If you have young children, your plan should also designate guardians to care for them in the event that you are no longer able to do so.

Planning for Incapacity

An estate plan is not just about what happens after death—it also addresses what should happen if you are temporarily or permanently unable to manage your own affairs due to illness or injury. Without proper legal documents in place, your loved ones may have to go through court proceedings to gain permission to handle your financial and healthcare matters, which can be time-consuming, costly, and emotionally draining.

If no plan exists, a court-appointed guardian or conservator may be required to manage your finances and medical care, often leading to loss of personal control over important decisions. This process can be particularly challenging if family members disagree about how your affairs should be handled, potentially leading to legal disputes that can become public record.

For families with limited financial resources, avoiding unnecessary court costs is especially important. Without proper planning, legal fees and other expenses could diminish the assets intended for loved ones.

Real-World Example

Consider the case of Sam and Meg, a couple with two young children. When Sam tragically passed away in a car accident without an estate plan, the laws of his state divided his assets among Meg and their children. This resulted in unexpected financial challenges:

  • Sam’s assets, including his share of the family home and an inheritance from his grandfather, were divided under state law rather than per his preferences.
  • His life insurance policy, which lacked a designated beneficiary, became part of the probate process.
  • Meg, a stay-at-home parent, had to return to work sooner than expected.
  • Court-managed conservatorships were established for the children’s inheritances, incurring ongoing legal fees.
  • When the children turned 18, they received their remaining inheritance in a lump sum, which was insufficient to cover their first year of college.

This situation could have been avoided with a properly structured estate plan.

Why Professional Guidance Matters

Estate planning involves critical decisions, such as selecting guardians for minor children, choosing individuals to handle financial and healthcare matters, and determining how to structure asset distribution. Attempting to create an estate plan without legal assistance can result in unintended consequences and legal complications.

An experienced estate planning attorney can guide you through the process, ensuring that your plan is comprehensive, legally enforceable, and aligned with your wishes.

Take Control of Your Future

If you want to secure your future and provide for your loved ones, now is the time to act. Contact our office today to schedule a consultation. We specialize in making estate planning simple and effective, helping you create a plan that reflects your values and priorities.

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