The Top Three Most Common Misconceptions And Misunderstandings
People have misconceptions about everything – and estate planning is no different. In any case, dismantling these misconceptions and misunderstandings is crucial to understanding estate planning in Florida, so that’s just what we’ll do here…
- Many have the belief that if they don’t do estate planning, the government steps in and takes your property or money. While this can occur in certain situations, there’s a lot that needs to happen before things end up at that point.
- People also often think that their situation is too simple or easy to justify investing the time and money into hiring an attorney. Because of this, they think that they can take care of their estate planning needs by themselves online. Let me tell you this: Estate planning is about a lot more than just filling out paperwork – and no estate is “so simple” that it can’t benefit from a plan.
- Most people don’t understand what the different estate planning documents do. For example, many people don’t realize that the focus of a will is on what happens after you pass away. In essence, this means that most people don’t know what a will is actually designed to do.
As common as they may be, these simple misconceptions have profound implications on how your money or other property is transferred to your loved ones. That’s exactly why working with a lawyer is so important – so that you can discover what you really need to protect yourself and the people you care about most.
Demystifying The Misconceptions: The Ultimate Goal Of Proper Estate Planning
The ultimate goal of estate planning should be to put a plan in place that addresses the complicated issues that can arise when you or someone you love is severely hurt, sick, or passes away. Think of it as attacking this situation from a position of strength and preparedness rather than leaving it to chance or to the default – state law.
A plan that addresses your estate planning needs should be done in a thoughtful and careful manner that considers the many realities and relationships of your life, leaving you at peace. Now, how exactly you make this happen will depend on various factors, namely, the stage of life you are in when you begin putting together your plan.
For example, a family with young children going on a vacation in a few months should set up nominations of guardians who would care for their children in the event that the children lose their parents on the vacation. Or, a short-term goal might be getting things set up so you could have healthcare or financial decisions made if you were unable to make them yourself. Meanwhile, longer-term estate planning goals might include understanding how to pay for care and navigating the different levels of care a loved one may need if they suffer a devastating illness or condition.
The Risks Of Not Having An Estate Plan
Of course, if someone passes away without an estate plan or even a will, they might get lucky and already have listed beneficiaries on all of their accounts, such as their bank account, retirement account, and life insurance policy. Their family might know what to do after they’ve passed away. But in my experience, more often than not, this is not the case – people aren’t lucky like this. Most of the time, families struggle to understand what properties or accounts belonged to their loved one, which forces them to make a guess. This can take an incredibly long time to figure out!
On top of this, not having an estate plan means you are left at the mercy of the default settings in the law as to who is considered an heir. This may not be in line with your wishes and upset your loved ones. It will also cost more money and take longer for the loved ones to sort things out through probate than if you were to just have an estate plan in place.
Many people avoid estate planning because it is a topic that requires some serious thought and discussion about unpleasant things. It makes sense – who likes talking about getting hurt, becoming disabled, or dying? It’s a very emotional topic. As understandable as this may be, it is in your and your loved ones’ best interest to work against this natural inclination and prepare.
The idea of hiring an attorney and investing in this type of work is also overwhelming to many people because they may not know what to expect in terms of cost. Many are understandably worried it will be too expensive or simply don’t understand how valuable it is to do estate planning with a lawyer’s guidance. But the truth is, creating an estate plan can save you and your family a lot of time and a lot of money. Through estate planning, you can save your family from issues such probate complications, creditor and tax problems, and more.
As a general rule, the earlier you start to plan, the more options you have available to you, so the best time to start planning is now – before you find yourself in an emergency situation. As an example, a loved one in the hospital unconscious and intubated will not be able to sign a will or a power of attorney. Remember, there are certainly times when it’s too late to do certain types of planning, but it is never too early to get started.