Even if you’re not a Kardashian and don’t have millions of dollars in assets, you need an estate plan. An estate plan can include a will and a trust. A will covers any property that you own and becomes effective upon your death, whereas a trust only includes that property that you put into it. A trust becomes effective when you create it. Whether you choose a will or a trust, your estate plan identifies how you’d like your wealth transferred after your death.
It identifies who will inherit your money, personal belongings, real estate, life insurance, retirement accounts, etc. Having an estate plan has many benefits. They are as follows:
1. An Estate Plan Helps Ensure That Your Wishes Are Properly Carried Out
One of the best reasons to have an estate plan is to ensure that your wishes are carried out. That is, when you die intestate (without a will), the court follows the intestate laws of your state or “laws of intestate succession.” That is, the court determines who gets what based on the relationship you have with the surviving family members, typically spouses, children and other relatives (parents, siblings, etc.). In essence, with a properly executed will or trust, you get to decide who gets your property, bank accounts, personal belongings and so on. You make the decision, not the court.
2. An Estate Plan Help Your Heirs Avoid a Messy Situation
The second reason to have an estate plan is to help your beneficiaries avoid a messy situation in probate court and protect their interests. Disgruntled family members can wreak havoc by contesting wills, but when you have a properly executed will or trust, your wishes will more likely be carried out. Your heirs’ interests will be protected – like you intended.
3. An Estate Plan Saves Money
he third reason to have an estate plan is that you save your heirs money in terms of estate and income taxes. For instance, when you set up a trust, you may be able to significantly reduce the amount of estate taxes that your heir has to pay in inheritance taxes. Of course, the amount you save will be based on many factors, including your assets, type of estate plan you’ve set up, etc. With this in mind, it would be best to secure the advice of an experienced legal team, like the ones at Ibekwe Law, PLLC, who can go over your financial situation and provide you with the best estate planning strategies to reduce estate taxes and protect your beneficiaries’ interest.
Having a clear-cut estate plan with a properly executed will or trust ensures that your wishes are carried out exactly how you want them to be. It protects your assets, helps your heirs avoid a bad situation with disgruntled family members, and can save you and your heirs from having to pay excessive money in inheritance or real estate taxes. If you want to find out how to design a solid estate plan, contact us at Ibekwe Law, PLLC. We can help you figure out your options based on your unique needs and financial situation.