Many Americans don’t know enough about the versatility of wills and trusts. This lack of knowledge isn’t their fault, as most Americans aren’t taught much about economic security, asset and property protection, guardianship, and the other legal security an estate plan can provide.
First off, the widespread myth that an estate plan is only for the rich is markedly false. Estate planning can be beneficial for those with the most modest income to assign a guardian for their children in case they pass at an early age or become incapacitated. Estate plans can pass down a home or a collection of books, jewelry, sports cards or stamps. These are some of the primary securities an estate plan can provide that could benefit anybody.
What estate planning benefits aren’t common knowledge?
The answer? Most of them. A survey conducted by Wealth Counsel found that the gap in estate planning knowledge is significant. 50% of those surveyed across all age groups didn’t know an estate plan can help them assign guardianship for their minor children. Only 45% knew that an estate plans outline personal healthcare decisions, like whether to maintain or suspend their life support or assign a medical proxy to make their decisions for them in the case of mental incapacitation.
Estate plans can protect family harmony and lower tax obligations
The benefits of an estate plan are wide-reaching, but understand that wills and trusts offer different protections. While 50% of respondents thought a will would help their family bypass the long, expensive and stress-ridden probate process, they are wrong. Only trusts can avoid probate. But even worse than probate is passing away without a will. If you have any property that you think someone wants once you pass away, family infighting is sure to occur unless you procure a document stating who will inherit said property.
Also, people use estate plans to lower or eliminate business and family tax obligations, help facilitate the transfer of a business, and set up lasting philanthropic efforts.
As we age, we learn more, as 58% of baby boomers knew about the ability to assign a medical proxy, but that number dipped to 24% for millennials. We shouldn’t have to wait until our old age to learn about planning tools that help protect ourselves and our families. If you have an interest in creating an estate plan, an estate planning attorney is ready to help. We all live differently, but no matter the size of your portfolio, security should be top of mind.