8 important reasons for a Texas resident to have an estate plan right now
Death is a very challenging topic to discuss. However, avoiding the conversation can create real mess for your children, grandchildren, and other heirs, especially if any of them are disabled or have special needs. Good Estate Planning
is the answer to many of those concerns. Moreover, without a proper estate plan, your assets
might not be distributed as you intended and your loved ones could suffer the consequences in terms of time, money, and stress (not to mention taxes and litigation).
Here are 8 important reasons to have an Estate Plan:
1. HAVE SOME PEACE OF MIND
Everyone needs a will. Unmarried persons, those that do not have children or those that do not have significant assets sometimes assume that they do not need a will. If you die without a will – which is referred to as dying “intestate”, the state law will determine the distribution of your assets, which may not be the way that you would want your property to be distributed.
If you have children, and both parents die without a will, the court will declare who will be named as the guardians of your children. Not only might the court’s decision about guardianship be different from what you would want, but it could also lead to significant family disputes about who will assume guardianship.
By setting forth your intentions in a will, you can ensure that your assets are distributed in accordance with your wishes, that your children are cared for by the guardians of your choosing, and that your personal matters remain private.
2. AVOID THE TIME AND COST OF PROBATE
If you die intestate, the probate process
is significantly more time-consuming and costly. A Court will oversee the distribution of your assets and the payment of your debts, which is often a slow and tedious process. Additionally, the court will require an annual accounting for all costs associated with the estate of an intestate decedent.
3. DIRECT FAMILY AND PHYSICIANS HOW TO MAKE HEALTH CARE DECISIONS
Your Estate planning documents will also generally indicate advanced directives regarding health care decisions before your death. This is essential so that you may direct the making of medical decisions on your behalf in the event that you become incapable of doing so. Without an advanced directive, a hospital may do whatever it takes to keep you alive even if that is not what you would want under certain circumstances. An advanced directive allows you to express your end-of-life choices to your family and to carry those wishes out.
4. NAME EXECUTOR/PERSONAL REPRESENTATIVE
By executing a will, you can specify whom you would like to serve as your executor to handle your probate estate. The executor has a significant amount of responsibility, from paying your debts and expenses, to deciding how your specific items of property will be allocated among your heirs. The personal representative also has the discretion to liquidate your assets, and distribute the cash proceeds, or distribute your assets in-kind to the heirs.
5. AVOID CONSERVATORSHIP UPON INCAPACITY
If you become incapacitated without a valid power of attorney in the estate plan, it is very difficult for someone else (even a spouse) to administer or manage your estate for you. An extremely expensive and time-consuming court process known as guardianship must be undertaken to administer a conservatorship on your behalf.
6. RESTRICT ACCESS TO CHILDREN’S INHERITANCE
In a case where the heirs are still minor or that they have poor financial judgement, the will may state that the inheritance be put into trust
. This is called a “testamentary Trust.” Such funds or inheritance in the trust must only be used for the best interests of the heirs, and the heirs ability to control the distribution of the funds is restricted. The will may also state when, and under what conditions, the inheritance may be accessible to the heirs.
7. ENSURE YOUR ASSETS WILL STAY IN YOUR FAMILY EVEN IF YOUR SPOUSE REMARRIES
Maintaining in the will that the living spouse holds the remaining assets in trust ensures that these shall be passed on to the remaining children in the event that the living spouse remarries (i.e., it prevents the new spouse from having much access to the funds).
8. AVOID BITTER FAMILY FIGHTS AND MAKE DIFFICULT TIMES EASIER
When there is no clear and fair distribution of inheritance according to the will of the deceased, there can be arguments and fights between the family. A will would clearly state the fair division and distribution of the inheritance to the appropriate heirs.