Five Reasons to do Estate Planning Even if you are Broke
I’ve had people tell me in the past that they don’t need to do estate planning because they “don’t have an estate to plan”. When I discuss estate planning with people, the term “estate planning” sometimes leads them to believe that they must be wealthy, or at least fairly comfortable, in order for an estate plan to be necessary. However, that couldn’t be further from the truth. The truth is, estate planning helps everyone prepare for what’s inevitable (death) and what is unexpected (a debilitating accident or disease).
Here are five reasons you may want to do an estate plan even if you don’t have many (or any) assets:
– You have minor children. If you have minor children, you want to do at least a minimal amount of planning. Ideally, you will have a will which will name guardians for those children in the event that something happens to both parents. You will also ideally have a trust in the will, which will shelter any assets you may have (including life insurance policies) to support the children until they are adults. At a minimum, however, if you aren’t willing to prepare a will or trust, you will need some type of writing that tells by whom you would want your children raised.
– You may become unable to manage your finances. If you were involved in an accident or developed Alzheimer’s or dementia, you may no longer be able to access your bank accounts, sign documents or contracts, or do anything that requires the mental capacity to enter into a contract. Virtually all estate planning attorneys will recommend that as part of the estate planning process, you execute a power of attorney which will allow a person you choose to handle your financial affairs.
– You may become unable to make healthcare decisions for yourself. You may remember Terri Schiavo, a young woman in Florida who died in 2005 after a very, very lengthy court battle between her parents and her husband. Ms. Schiavo went into cardiac arrest, suffered brain damage, and as a result was left in a persistent vegetative state. Her husband wanted her feeding tube removed, and her parents did not. The parties battled for years, and ultimately the feeding tube was removed and she died. If she had had a healthcare directive which spelled out her wishes, the situation could have been avoided. As part of estate planning, typically a Georgia Advance Directive for Healthcare is done.
– You don’t know what your assets will be when you die. Although you may consider yourself broke now, you don’t know what your assets will be when you pass away. You could win the lottery and die the same day (you think I’m making that up? Google “win lottery hit by car” and see what stories come up). You may receive an unexpected inheritance, or have life insurance you had forgotten about and didn’t name a beneficiary on. Situations like this are not rare. If any of these situations occurs and you don’t have a will, that property will most likely not go where you want it to go.
– Your family is at least a little dysfunctional. If you have a spouse, several grown children, all assets are titled correctly, your children all get along perfectly well, and you want your assets to go to your spouse upon your death, and then your children, you may be ok without a will, assuming you and your spouse do not die together, and that the surviving spouse immediately does estate planning upon the death of the first spouse. Guess how many situations I see like that. Very few. Unfortunately, death can bring out the worst in people. Most people I meet know at least one family that quit communicating after a death in the family because of hard feelings. At times, getting family members to cooperate after a death can be almost impossible. Take the guesswork out of the equation and do a will.
Many of my clients think they can’t afford to do any estate planning. The truth is you really can’t afford not to. I have reasonable prices, and payment plans and credit card payments are available. Call me, Sarah White, Marietta estate planning attorney at 678-453-6490 to learn more.