Estate planning isn’t something many people want to think about. Aside from confronting their mortality, common myths regarding who needs an estate plan or what estate plans accomplish often prevent people from taking essential steps to safeguard their legacy and their loved ones.
Below are three of the most common mistruths about estate planning and the facts behind them:
Myth 1: You don’t need an estate plan yet
Perhaps the most common misconception about estate planning is you don’t need to start unless you are terminally ill, elderly or ultra-wealthy. While it is true that members of these groups have a more pressing need to establish an estate plan, the truth is everyone has assets and belongings that they can’t take with them when their time comes.
Even if you are young and healthy or have little possessions, if you answer “yes” to the following questions, you should consider establishing an estate plan in the event of your death or incapacitation:
- Do you want to choose who inherits your property?
- Do you care what happens to your children or dependents?
- Do you want to limit family conflicts that might arise after you’re gone?
Myth 2: Estate planning is just about who gets what
If your only knowledge of estate planning comes from television shows or celebrity tabloids, you might think that estate plans are just about distributing your wealth and assets. While an estate plan does accomplish this, it also serves to protect your interests and future income needs.
With an estate plan, you can accomplish several important goals, including:
- Naming guardians for minor children
- Express your interests for your funeral arrangements
- Document the type of care you would like to receive should you become sick or incapacitated
- Allow your family to avoid the probate court process after your death
- Name your executor or trustee
Myth 3: You don’t need to update your estate plan
Many people assume that once their estate plan is in place, they are set for life. But a lot can change between when you draft your estate plan and pass away. You must review your estate plan every few years or after any major changes to your circumstances.
If any of the following life events occur after creating your estate plan, you should review your plan to ensure it still aligns with your goals:
- Changes to your marital status
- New family members such as children, grandchildren or in-laws
- Moving to another state
- Changes to federal or state estate tax laws
There’s a great deal of misinformation surrounding estate planning, but the truth is, everyone needs an estate plan. Creating an estate plan today can bring peace of mind knowing that you have taken steps to protect yourself and your loved ones.