This belief is so common that it almost appears factual. Although it is significantly more affordable than establishing a trust, many people are under the impression they don’t have enough assets to even warrant the cost of creating a will. Not only do people have more assets than they realize, but they also aren’t aware of the potential complications that arise from not having completed any degree of estate planning.
When you pass away without a will, trust, or having done any estate planning, your assets go through probate. The probate distributes your assets according to intestate laws, and no consideration will be given to what you would have wanted. Are you ok with that? Even if the answer was “yes,” you need to understand the hurdles and challenges you are leaving your family with.
The Challenges
The above example appears straightforward only because we didn’t elaborate on the probate process. Let’s do so through the following fictitious scenario: Imagine someone who is young and doesn’t see the need for estate planning. This person is involved in an accident (something that can happen to anyone regardless of age) and is incapacitated. If this person needs potentially life-saving surgery, who is there to authorize it? Furthermore, who is going to pay for it?
These are fundamental questions, and they could have been answered through basic estate planning. Even if someone has minimal assets, they should still have a healthcare power of attorney (for medical decisions) and a financial power of attorney (for financial decisions). Without them, no one can advocate on your behalf regarding the treatment you need. They won’t be able to access your accounts to pay for it either. One of the biggest reasons why not having enough assets for an estate plan is untrue is because some of its elements have nothing to do with money.
Probate
Probate can be costly and time-consuming. Even small estates that go uncontested (and don’t involve litigation) can easily cost upwards of $5000. These fees come out of your estate. When you don’t make your wishes known through estate planning, your assets get distributed to intestate laws. Imagine a person who passed away, was in their second marriage and had children with both spouses.
Most of that person’s assets go to the current spouse, and nothing requires the surviving spouse to share those assets with the children of the first marriage. That is just one example of how quickly intestate laws could cause fighting within a family.
Jayaraman Law
At Jayaraman Law, we take the stance that estate planning is for everyone. By taking action now, you can ensure your assets go to the beneficiaries of your choosing, and you will have a healthcare power of attorney and financial power of attorney. If you have any further questions about wills, trusts, or estate planning, contact the Jayaraman Law to schedule a free consultation.
Jayaraman Law
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