Most people have heard of a Will, a Power of Attorney, or a Trust. I love the fact that these documents have become common knowledge and household terms but it’s so frustrating when so many people think estate planning isn’t necessary for them; estate planning is for other people, like the elderly and the rich! For whatever reason, there are dozens of myths and false information out in cyberspace declaring the dos and don’ts of Estate Planning, such as who actually needs estate planning and who doesn’t, the cost of preparing estate planning documents, and what to avoid in the process. Way too many people feel as though estate planning isn’t important until much later in life, or that it’s just entirely not an option for them because of the cost. It’s time to set the record straight on 3 of the biggest facets of false information regarding estate planning today.
Myth #1 – Only The Rich Need Estate Planning
This is definitely not true! While estate planning definitely benefits people with many assets including a large bank account, people from all over the financial spectrum can benefit. The biggest group of people who should look into having an estate plan done is parents of minor children. With a Will in place, you can designate guardians who will take care of your children if (or when) you are unable to do so anymore. As a parent, your children are the most important and precious things in your life. It is only natural that you would want to make sure they are protected and cared for if the worst situation were to happen. By not designating a guardian, there’s always the possibility of ugly family disputes and confusion. Once you complete your Estate Planning, you can breathe a sigh of relief knowing your children will be well taken care of by the guardian of your choosing. Additionally, estate planning provides reassurance as you know exactly how your estate will be distributed because it’s exactly the way you decided. This provides ease and comfort for your family upon your passing.
Myth #2 – Estate Planning is Expensive and Time-Consuming
Again, not true at all! If you’re one of the individuals mentioned above who let’s say has an estate worth over 10 million, that by default makes things a bit more complicated and expensive. That said, for your average Jane and John Smith, the majority of estate planning is affordable. In recent years, more attorneys are offering Estate Planning packages at fixed rates (usually a few hundred bucks) that are designed for your needs. Your personal estate planning package might just need a simple Will, or maybe you want additional depth and reassurances by including or Powers of Attorney. Here at Jerimy Kirschner and Associates, we sit down with our clients and discuss their personal goals and needs. What type of security and legacy do they want? Based on this meeting, we usually know what documents that person will need for their estate plan. We want to make sure our clients are happy and are only paying for the documents they need. If you still think this is out of the realm of possibilities for you, here’s an industry fact for you: In a probate matter, your average attorney will require a $5,000 retainer to handle the probate. A $5,000 retainer is much more expensive than an attorney from Jerimy Kirschner and Associates drafting up a handful of documents allowing you to protect your property, assets, and family.
Myth #3 – A Will Can Prevent My Estate from Needing Probate in the Future
Nope. This is false! If you only have a Will, you will most likely have to go through probate. The exception to this rule is if the estate is worth under $100,000.00, then a Small Estate Affidavit may be used. Otherwise, a Will goes through the probate process. During probate, the personal representative named in the Will basically makes sure that the deceased’s wishes that are expressed in the Will are followed through with. Now, probate can get a bad reputation, which is unfair. There can be some drawbacks but in Washington State, the process is relatively simple. That said, not everyone needs to avoid probate. For some people, avoiding probate is a great idea and there are definitely ways to do so, namely through a Trust. Why do you need a trust? Well, you don’t need one, per se, but they are beneficial for a variety of reasons, one of which is to avoid probate. If you fund your trust during your lifetime, you will avoid probate. Avoiding probate means your family will not have to go to court to authenticate your Will after your death in order to access your assets. This saves time and money. If you think you might need a trust, give us a call and we discuss why this might benefit you and your loved ones!