Many people believe that only the wealthy need estate planning. In fact, while the complexity of the plan needed may vary due to the amount and nature of a person’s assets, the need for an estate plan is common between a billionaire and the average person. Here are five reasons the average person needs an estate plan.
- You have children.
Florida law provides a statutory default for inheritance of property where a decedent does not leave a will. This default does not provide for many of the special circumstances that surround children. Perhaps you have minor children (or adult children with potential creditor issues) who should not inherit a large sum of money directly. Perhaps you have multiple children and you wish to disinherit a child or provide for your children unequally. Such individual wishes require an estate planning document like a will or a revocable trust. Additionally, where an estate plan does not treat all children alike, special steps should be taken to document your intent.
- You are divorced (and remarried).
Every family dynamic is different, but blending children from a previous relationship with a new spouse brings up a whole host of issues. Significantly, such a dynamic can create a conflict between the desire to provide for a surviving spouse and leave an inheritance for children. While it is possible to find balance and achieve both objectives, doing so requires planning. If planning is done prior to remarriage, it may be that a prenuptial agreement is appropriate (or a postnuptial agreement after marriage) to make sure both spouses agree to some general terms.
- You own a business (small or large).
If you own a business, alone or with others, there are special considerations upon the death of an owner. Business interests can be subject to restrictions on transferability and ownership which require the appointment of specific fiduciaries to deal with those interests or that certain action be taken to pass ownership of the interest. Additionally, a personal representative can only carry on the business of an unincorporated business for up to four (4) months without getting authorization from the court. Both business and estate planning are necessary and appropriate for business owners to ensure a smooth transition upon the death of an owner.
- You have concerns about probate.
Probate is a very useful process that restricts creditors, however many wish to avoid the probate process for certain assets or minimize the process for the convenience of heirs. A revocable trust can be a useful tool to do just that.
- Peace of mind.
Many find peace of mind in memorializing their wishes, regardless of whether any special circumstances apply. A will can provide a feeling of closure and planning for both the testator, and later, his or her heirs. Nor is estate planning limited to the testamentary document. Ancillary documents such as power of attorney and health care documents lay out choices with regard to property and medical decisions during life should the maker be unable to make those decisions.
While many of the reasons to have an estate plan are common, each person’s estate plan should be crafted to meet his or her individual needs. Please contact Dean Mead’s Estate and Succession Planning department to discuss your needs further and what estate plan might be right for you. A link to the list of attorneys and their contact information is provided here: http://www.deanmead.com/practice-areas/estate-and-succession-planning/.
About the Author:
Dana M. Apfelbaum practices in the areas of federal income, estate, and gift tax law and family business succession planning. She counsels individuals in estate planning, with an emphasis on implementing the client’s objectives, asset protection and minimizing wealth transfer taxes. Ms. Apfelbaum also represents fiduciaries through all stages of probate, estate and trust administration. In addition, she represents businesses and business owners in all types of business and tax matters, including choice of entity, mergers and acquisitions, reorganizations, other general business matters, and succession planning. She may be reached at firstname.lastname@example.org.