Many people in the middle class ask, “Do I have an estate to plan? You may think that you don’t have the wealth that would require you to engage in extensive estate planning. If you have a will, you might think that’s good enough.
We find that clients often greatly undervalue what they have to plan for. Your “estate” is everything you own. Most people think of their home, investments, and bank accounts. They often overlook the value of their contents and vehicles, as well as life insurance death benefits and retirement plans.
Forbes’ recent article, “Why Estate Planners Aren’t Just for the Ultra-Rich,” says that nothing could be further from the truth.
Although some estate plans are more complicated than others, just about everyone can benefit from having one. Let’s examine the main reasons why:
Avoiding probate. This is a big reason why the importance of estate planning is for everyone. You don’t have to be part of the 1% to want to avoid putting your family through the stress and expense of probate. Creating a trust and strategically placing assets within its control eliminates many headaches.
Maintaining control from the grave. Even after death, you can still influence how your assets are distributed, to whom, and when.
Protecting your legacy. When you consider leaving a legacy for the next generation, it may have lofty pursuits. However, those aren’t necessarily reasonable goals for everyone. Leaving a legacy can also mean making certain that heirs properly respect all the effort and sacrifice that it took to save and create a retirement fund, whatever its size.
Creating a business succession plan. Among the countless small businesses in the U.S., most will continue to remain viable after the legacy owner dies. A business owner can plan for this within an estate plan that details exactly what they want to happen if they die unexpectedly. That could include outlining specific roles and responsibilities for surviving heirs or putting into place a buy-sell agreement with a business partner and directing the distribution the proceeds of the sale.
You do have an Estate to Plan.
Be sure to revisit your estate plan regularly, especially if your life includes big events, like the birth of a child, a divorce, or an irreconcilable difference with a loved one.
Middle-class folks can benefit from estate planning. It’s a myth that this is something only wealthy people do. It’s for everyone.
Reference: Forbes (April 15, 2019) “Why Estate Planners Aren’t Just For The Ultra-Rich”