There are many benefits to creating a valid estate plan, including ensuring that your final wishes are upheld. Without an estate plan, your estate is not protected from Utah’s intestate succession laws, and therefore, must go through probate. Probate is a costly, public, and very time-consuming process that most families wish to avoid at all costs. Today, we go over the reasons why it is so important to establish an estate plan.
Main Benefits of Estate Planning
An estate plan makes sure that your loved ones are taken care of when you die. It also helps your beneficiaries avoid certain taxes and other legal requirements when it comes to dividing your property. Here are some additional benefits of estate planning:
Estate Planning Can Give Your Family Peace of Mind
Without an estate plan in place, your loved ones will not know what to do with your assets and property. They will need to determine who inherits what, which could lead to disputes and other issues among close family members. This is the last thing they want to do while mourning their family member’s death. One of the main benefits of an estate plan is that you are responsible for what happens to your estate after you die.
Avoiding estate planning can cause your assets to fall into intestate succession. This is a process where the state controls your estate. It uses the estate’s money to pay off creditors, and it can even pay itself with your money.
Whatever is leftover will be given to your closest blood relatives. Property goes to your spouse first, then your kids, then your parents, and so on. You may have other, close loved ones who are left out of this plan.
Additionally, if you become incapacitated, your family will need to make important medical decisions on your behalf. An estate plan includes information about your final wishes in the event of incapacitation. Without one, your family will be forced to make these decisions for you, which could go against what you would have wanted.
Estate Planning Can Protect Your Loved Ones
One other aspect of estate planning is determining who will care for your children in the event you die or become incapacitated. As this decision greatly impacts your children’s lives, it would be best if it were determined by you instead of the court system.
Hopefully, the court will give your children over to a willing, close relative. It can, however, separate them and turn them over to professional guardians. These people can be strangers to your children. You kids could even end up in a group home, having a very depersonalized experience.
You can name your child’s guardians in your estate plan, avoiding all this potential struggle.
You can also protect your family members and loved ones by safeguarding their futures with an estate plan. This allows you to choose who will inherit certain aspects of your estate to make sure they are provided for after you die.
Estate Planning Can Reduce Taxes and Other Legal Fees
Your beneficiaries will not need to go through the probate process with a valid estate plan in place. The probate process includes court fees, legal fees, attorney fees, and more, which could significantly reduce the amount of money your family can inherit from you. Additionally, probate takes time, which means your beneficiaries will not be able to collect their inheritance in a timely manner.
A trust acts as a living financial entity. It can continue to grow your estate through buying and selling property, investing, and so on. When the trust passes property along, it avoids probate. Essentially, it is just a gift from the estate to the recipient. This transfer can significantly cut down fees associated with property transfers.
Estate Planning Can Pass Along Sentimental Property
Estate planning isn’t always about preserving your loved ones’ futures. Sometimes, it’s simply about giving someone a gift from the heart.
Perhaps your family is disinterested in your video game collection, but you have a close friend that you bonded with because of this collection. You can give this collection (and other items) to those who would most appreciate it. This is called “making a bequest.”
Estate Planning Can Continue Your Business Legacy
If you wish for your business to continue after you die, you can include instructions about who will inherit your business in an estate plan. Without one in place, your business could fall apart. This could harm your family financially if they relied on that company for income. Additionally, it would be helpful to include some information about running the business for whoever inherits it so he/she can understand how the company functions.
How your business passes along should be part of your overall business plan. A will can give everything over to your beneficiary at once; a trust can keep the business within the estate, allowing it to be run by a trustee or a group of trustees.
To learn more about our estate planning services, contact us online or call our office at (801) 901-7046.
