Presidential Debate Season – Debunking Estate Planning Myths Part 1
If social media is any indication, seemingly every human being watched the first Presidential Debate, and, perhaps more importantly, expressed their viewpoints in the aftermath. While I’m not a fan of everything that social media has to offer, it has clearly provided a platform for the masses - whether informed and educated or irrational and ignorant - to voice their opinions and facilitate the transmission of information. It is on this same platform that I wish to debate against the arch-nemesis of estate planning attorneys everywhere - the human tendency of procrastination.
1. “There’s no reason for me to see an estate planning attorney, I have no estate; I’m not wealthy.”
One of the bigger misconceptions in my industry is that only the wealthy require estate planning. The fact of the matter is it is very rare for an estate to require advanced estate and tax planning strategies - especially considering the current exemption amount of $5.12 million per individual. Despite this misconception, there are many reasons for all people to evaluate their lives and consider estate planning sooner rather than later:
The bottom line is that it is never too early to begin planning for incapacity. Just don’t let it be too late.
- You have an Estate – Anything in which you have an interest at death is included in your estate. Not only does your estate include brokerage accounts and real property, but also cash, bank accounts, household items, cars, artwork, and collectables. Even more relevant nowadays is an individual’s interest in digital assets. This includes everything from online usernames and passwords to photos, music, and social media proprietary interests. It is very rare that someone literally doesn’t have an estate. And as my father once told me, “anything with your name on it is worth protecting.”
Children – Whether you consider yourself wealthy or not, nominating a trusted guardian for your children is critical for all young families. While extensive tax planning and legal maneuvering can be valuable and necessary for some estates, the overwhelming reason clients solicit the counsel of an estate planning attorney is to assist them in protecting their family and children if something catastrophic were to occur. People simply want a piece of mind. Executing a document that designates your guardian provides security and comfort in the knowledge that your children will be taken care of according to
your desires. Now you can book your next sky-diving adventure!
- Managing your Assets – Let’s face it, we have all been blessed with certain gifts and talents. Some of us have also been, well, I guess “cursed” with limitations. While some of us can wholeheartedly trust our spouse to manage our finances, for others, balancing a checkbook or creating and implementing a budget is akin to learning to speak Hungarian. Crucial to any plan is nominating the right person to manage the estate. Depending on the type of plan you have, this person is the Trustee, Executor, or Agent pursuant to a Durable Power of Attorney. Rather than burdening your spouse or next of kin with a potentially overwhelming responsibility, it is important to thoroughly consider your options and incorporate that person in your estate planning documents.