Digital Journal’s recent article entitled “What is an Estate Plan and What are its Benefits?” explains that an estate plan usually includes the following:
- A will;
- A financial power of attorney and a medical power of attorney (with consent);
- A living will; and perhaps
- A living trust.
You also need an experienced estate planning attorney who understands the possible strategies that are available to you for your family.
There are many significant benefits to establishing an effective estate plan, including deciding who will inherit specific assets, possessions, or valuables; and designating guardians for minor children; and avoid or minimizing taxes.
Without an estate plan, heirs must go through a very stressful probate process, which can take years. It can also be expensive. With a will, you can protect your young children and ensure that they are cared for by designating a guardian. Without a will, the court decides who will care for your children.
You can also stop fights before they start with an estate plan. One sibling—for whatever reason—may think he or she deserves more than the others. Such disagreements can easily wind up in court, with family members fighting each other and costing thousands in legal fees.
With an effective estate plan, you can make certain your assets are handled the way you intended if you were to become mentally incapacitated or pass away. You can choose who will be in charge of your medical affairs, financial affairs, and even specific assets such as a small business. If a business owner doesn’t have an estate plan, state law would determine who would be in control of the business.
A big question for a small business owner is who will oversee the business if he or she becomes incapacitated or dies. A key is determining the best strategy after the death of the owner. A business succession plan is critical.
Reference: Digital Journal (Sep. 2, 2021) “What is an Estate Plan and What are its Benefits?”