Why Estate Planning?
Whether you know it or not, the “system” has developed an estate plan for every one. The question then becomes, “Do you want to default to the estate plan the system created for you, or do you want to be proactive and take control of your estate yourself?”
For example, without proper estate planning you will pay for everything: medical bills, legal bills, Probate, taxes, etc. With planning you can take advantage of the options available to you to minimize what you will pay for health care, legal expenses, and taxes while you are alive and long after you are gone.
If you do nothing, like the proverbial ostrich with his head in the sand, you will pay the most for everything. To use an accounting analogy, do you want to take the deductions available to you or ignore them and pay more taxes than the IRS requires? Does the IRS call you to tell you there are more deductions available to you or just take the money? The same is true with estate planning. The problem is that most people don’t know what options are available to them.
Estate Planning has become a complex area with multiple government agencies conflicting with each other. Furthermore, they keep changing the rules. For example, most people believe that all they need to do is create a will and they are done. That is only the beginning; a will guarantees you will go through Probate! There, for a couple of hundred of dollars you have set yourself up to lose thousands of dollars for a very expensive process that could have been easily avoided. (I am not suggesting that you do not need a will.)
Each case is different and if you haven’t worked with an estate planner you need to take the time to find out what you don’t know.
You don’t have to be rich to do an estate plan. If you only own a home you more than qualify. Will it go through Probate, do you give it to your kids, sell it, or will a nursing home take it? Each action has consequences.
If you or a loved one is facing an expensive long term care stay at an assisted living facility or nursing home there are things you can and should do to minimize your financial exposure.