Estate planning refers to a comprehensive process that people partake in which decides how their assets will be divided and distributed after their demise, and how other related decisions are to be made. While writing a will is a crucial part of it, there is more to estate planning than what the general perception believes in. Listed below are five reasons why you need to engage in estate planning:
1. Estate planning allows you to have control over your property
Irrespective of whether your legacy is big or small, it is valuable to both you and your family. Your legacy would be something your loved ones are likely to cherish long after you are gone, and would be something that would remind them of you. If you don’t leave an estate plan behind, the state is likely to make all estate related decisions on your behalf and determine what happens to all the assets, valuables, and properties you leave behind.
2. Estate planning allows you to plan for unexpected events
In case of sudden illness or in case of an unfortunate event happening in your family, estate planning helps you make sure that you plan for such unexpected events. If you have an estate plan, you can ensure that your loved ones will be cared for and that they’d have substantial assets to support them for a little while. You can determine how your assets get distributed for each of your loved ones in a manner that you think is the best – as opposed to having the state do it for you.
3. Estate planning allows you to guide your loved ones in your absence
An estate plan also serves as a guide for your loved ones after you pass away – it saves them from the frustration of assessing what did you want and saves them the trouble of looking through your documents determining whether you wanted something done. You can ask your loved ones to donate your clothing, make any lasting wishes, make decisions about your pets, etc. through your estate plan.
4. Estate planning allows you to help avoid probate costs
In case of absence of estate planning, your estate is likely to go into probate and if that happens, a considerable chunk of your loved ones’ inheritance goes into handling probate costs. These costs typically include costly court fees, lawyer fees, administrative fees, etc. Your loved ones are likely to be already suffering in your absence, and one wouldn’t want their loved ones to suffer at all. Hence, an estate plan saves your loved ones the effort at a later time.
5. Estate planning allows you to save yourself in case of incapacity
In case of an unfortunate event of an accident that leaves you mentally or physically incapable, an estate plan can also act as a power of attorney document which will dictate who gets to make decisions on your behalf. You can also use an estate plan to decide who will take care of you in case of incapacity. It is likely to be very beneficial for you in case of such an unfortunate and unexpected event.