Everyone needs an estate plan, and not making one leaves the serious possibility that your affairs will not be handled in the way you want them to be, nor your goods distributed as you wish them to be, in the event you are incapacitated or you die. If you have spent most of your adult life working hard and building wealth, then it is important to preserve that wealth; not only for your own enjoyment but also for future generations. Solid estate planning ensures your hard-earned money will pass to the beneficiaries you intend, not to government agencies and bureaucrats.
What If I Don’t Make an Estate Plan?
If you do not make an estate plan, the government will do it for you. An estate plan crafted by the government, called Intestate Probate, guarantees the government will interfere in the disposition of your estate. If there is no estate plan and your belongings are divided through Intestate Probate, then all payments must have court approval, in the public eye. This can be an extremely burdensome process, if you need approval in advance for all expenditures.
Failure to plan your estate can also lead you afoul of the federal government’s death tax. It is quite possible through advance planning to reduce and in many cases eliminate the estate tax entirely, but if you do not plan your estate and instead your belongings go through intestate probate, then the government will not design an estate plan which will reduce the taxes on your estate.
Your Estate Plan Basics
Estate planning does not only mean having a will or trust to avoid the estate tax; it also includes documents to deal with mental and physical injuries you may have later in life. The bedrock of a good estate plan, however, is a will.
A will is a legally binding document which distributes your assets upon your death. The distribution will be done through probate, and upon your death, the will becomes a public document which is available for inspection by all those interested. Once the will enters the probate process, it is out of family control and under the control of probate attorneys and the courts. Probate can unfortunately be time consuming, expensive, and cumbersome. Many people try to avoid probate through the use of a trust.
A Living Trust is able to avoid probate because the property is owned by the trust. This means that as a technicality, there is nothing for a probate court to administer. Whoever you name as the “successor trustee” will gain control of the assets and distribute them according to your instructions. A living trust offers more flexibility than a will. A will does not become effective until you die. That means it is no use for estate planning during life, unlike a Living Trust. A Living Trust can help preserve and increase the trust and offers protections for you if you become mentally disabled.
Whitaker Hagenow & Gustoff Can Help
Many of our estate planning attorneys maintain positions of trust in the Iowa legislature and government, in addition to their thriving estate planning practices in Cedar Rapids and Des Moines. Our skilled estate planning attorneys understand that making an estate plan can seem daunting. We will help you plan for a time when you can no longer advocate for yourself, as well as for a time when you are no longer with us, and do so with empathy. Call or email us today for an initial consultation.