The majority of American adults haven’t done any estate planning. It may be due to confusion and misconception regarding the purpose and process.
Therefore, it’s essential to address some of the myths about estate planning so people can make an informed decision.
Myth 1: Only wealthy people need estate plans
Estate planning is often linked to wealthy people who have a large estate or extensive assets. The truth is that estate planning is more than the distribution of your wealth after you die. You can also designate a guardian for minor children and decide who will make financial, legal and medical decisions for you if you can’t make your wishes known. Without those legal documents, Virginia’s courts will decide for you.
Myth 2: Estate planning is for old people
When you’re young, the idea of dying seems a long way off. Most young adults feel invincible and believe that nothing bad can happen to them. However, accidents and illnesses don’t have set timelines, and life is unpredictable. You could become incapacitated and need someone else to relay your wishes. Power of attorney (POA) is the legal document that allows another person to make financial and medical decisions for you.
Myth 3: A will is all you need
A will is the foundation of your estate plan, but it doesn’t cover everything. It doesn’t designate someone to make decisions on your behalf, and it doesn’t help to avoid probate, which is the legal process of validating the will. Estate planning utilizes various tools, including a Power of Attorney (POA), advance directives and trusts.
Myth 4: Once you create an estate plan, you never need to refer to it again
Many people believe that once you make an estate plan, you can put it away and never have to look at it again. However, life is fluid and ever-changing. Your estate plan should be updated after every significant life change, such as a marriage or divorce, the birth of a child, or starting or selling a business.
Estate planning is for anyone who wants to ensure their loved one’s financial security and make their lives easier during a difficult time. Discuss your goals with a legal representative who can create an estate plan tailored to your specific needs.