If you were playing a word association game and said “estate planning document,” it is likely that the most common response would be “a will.” Indeed, folks who may not have a full understanding of the universe of estate planning possibilities at least know that they should have a will. What they don’t realize is that a complete estate plan includes much more than a last will and testament.
The whole concept of estate planning is based on the desire to secure your financial future and provide protection and peace of mind for your loved ones. The reality is that a will, while a great start, is often insufficient by itself to accomplish those goals. Whether you are just starting your estate planning or are thinking about updating and enhancing your current documents, make sure that you address these five essential issues.
A will only becomes effective after you die. Unfortunately, many of us will face the possibility that we will become severely ill, disabled, or incapacitated and not be able to make important decisions regarding our health, treatment, and financial affairs. If you haven’t addressed these issues in advance, your loved ones will be left to wonder about your wishes and what they should do, adding another layer of stress and confusion to what is already a difficult time. This is why incapacity planning is a vital part of any thorough estate plan. With an incapacity plan, including such documents as a power of attorney for health care or property, you can appoint a responsible, trustworthy person to oversee your financial and health care needs if you become unable to handle them on your own.
Most people seek to avoid probate, and there are plenty of good reasons for this. The probate process can consume a tremendous amount of time and money, putting stress on loved ones left behind. A well-drafted estate plan can ensure that your heirs receive your bequests swiftly and without the burden of a prolonged probate process.
As human longevity increases, and people stay healthier well into their 70s, 80s, and beyond, it’s important to plan for an extended lifespan. You want to have enough money to live comfortably throughout all of your retirement years. Your estate plan should incorporate detailed retirement planning that helps you achieve this goal.
Business Succession Planning
Many business owners plan on selling their businesses as they approach their retirement and use those funds to provide for themselves and their family during their golden years. However, in a recent PwC survey of family-owned business owners, 73 percent reported not having a substantial and documented succession plan. In a family-owned business, this lack of planning can create significant conflict and damaged relationships. A business succession plan provides answers for a variety of contingencies, such as what happens if the owner becomes incapacitated. By providing clear direction, it allows the business to run as smoothly as possible in the event key leadership dies or can no longer oversee the business.
Few people like to think about the possibility of needing Medicaid, but they ignore planning for it at their financial peril. Without proper planning, you might have to pay out-of-pocket for nursing home care. A prolonged stay at a long-term care facility can consume a lifetime’s worth of assets in a relatively short amount of time. With the right strategic planning, you can preserve your estate for your spouse and other beneficiaries.
The Law Offices of Louis R. Fine
When you are ready to start working on your estate planning or if you just have questions about how to proceed, give me a call at (312) 236-2433 or fill out my online form for a free initial consultation. I will work with you to create an estate plan that suits your needs, budget, and goals. While thinking about your own demise may be unpleasant, the peace of mind that comes from knowing that you have provided for your loved ones and spared them from additional grief is invaluable.