Estate planning is not just about what happens to your assets after you pass away. It is about life planning too.
While wills and trusts may seem more important, powers of attorney, living wills, and guardianship documents for minor children have crucial impacts during one’s life. According to the Cannon Financial Institute, you are three times more likely to become disabled due to illness or injury than to die suddenly. How your loved ones handle your affairs if you are incapacitated or disabled can have a drastic and irreversible effect on what you leave behind after you pass. And how a loved one cares for your children if you are incapacitated or disabled has a lasting effect on their lives and what kind of adults your children grow up to be.
Whether you’re planning for life or death, estate planning is essential to avoid the probate court. Probate is used for two main purposes—transferring title from your name to your heirs’ names, and appointing someone to be in charge of another individual not able to care for themselves.
Wills and trusts may seem more important, but these documents typically address only the “Who gets what?” question. Your family may have to navigate the probate court system many years prior to your death if you don’t do the proper life planning. By overcoming any fear or reluctance to address the admittedly upsetting questions of what happens to you and your children if something happens to you, you can help your loved ones avoid the probate court entirely.
With the proper estate planning that goes beyond the basic will, you—not the probate judge—decide who raises your children if you can’t whether due to a disability or your death, and you decide who responds in an emergency to care for your children in the short-term. You decide who handles your financial affairs and medical decisions without any interruptions in the process, and you specify ahead of time what your doctors should do if you are sustained only by life support. And you decide who manages the assets you leave behind for your family and you protect your children’s inheritance from their own lawsuits, creditors, and divorce.
Without these documents, the probate judge decides who is in charge. A family member may look wonderful on paper but perhaps they are someone you would never allow to handle your finances. How this person chooses to handle your financial affairs potentially can deplete the very assets you presumed would be there for your family after your death. Incorporating estate planning documents that go beyond the traditional estate planning question (“Who gets what?”) is a must-do.
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