This is an article from the law office of Amen, Gantner & Capriano (http://www.yourestatematters.com/) in St. Louis, Missouri, that we thought others may find helpful.
When it comes to estate planning, there are a number of common myths and misconceptions that cause people to fail to properly plan ahead as they should. One of the most common of those misconceptions is the often heard “I don’t need an estate plan until I’m older and/or wealthy right?” The truth is that everyone over the age of 18 should have at least a basic estate plan in place. Knowing why should help you to get started on yours if you have yet to do so.
One reason people often believe that an estate plan isn’t necessary unless they have a considerable fortune is that they fail to understand all that an estate plan can accomplish. While it is true that an estate plan can serve as the roadmap for the distribution of estate assets after your death, and that the more assets you have the more important an estate plan becomes, that is not all an estate plan can do for you and for your loved ones. Just a few of the additional goals and objectives an estate plan can accomplish include:·
- Incapacity planning – incapacity can strike at any age and does not discriminate with regard to wealth. If you suddenly become incapacitated who will manage your assets? Who will pay your bills? Who will decide what medical treatment you receive or don’t receive? Who will decide where you will be treated or even where you will live? Unless you have an incapacity plan in place a court may have to decide who will make these decisions and who will control those assets you do have.
- Medicaid planning — when you reach your “golden years” there is a very good chance you will need to qualify for Medicaid to cover the high cost of long-term care. If you fail to plan ahead you may lose those assets you have managed to accrue during your lifetime, modest as they may be.
- Parent of minor children – if you are a parent, your most valuable asset is your child. Your Last Will and Testament is the only opportunity you have to tell a judge who you want to be that child’s legal guardian should one be needed some day. Your estate plan is also the only way you have to plan for the care and maintenance of your child should something happen to you.
- Pet planning – if you have a pet that you consider to be part of the family you likely want to ensure that he/she is well cared for should something happen to you. Incorporating a pet plan into your estate plan can accomplish this easily, giving you peace of mind.
- Business succession planning – if you own a small business you likely want to ensure that it is passed down to the next generation or that the proceeds of the sale are used to provide for your loved ones should something happen to you. Unfortunately, 80 percent of small businesses don’t make the transition to the next generation because the owners failed to plan ahead.