In a recent article written for Forbes, Deborah Jacobs spoke about the topic of who needs estate planning. As she noted, there are a number of people out there who tend to write off the idea of estate planning, thinking that it doesn’t apply to them, that it isn’t something they need. The truth is that every adult can benefit from some degree of estate planning.
One does not need to own real estate or lots of property to have an estate. One’s estate is simply everything one owns at the time of death. This includes personal property, one’s home and other real estate, investments, bank accounts, retirement accounts, interests in family businesses. Assets with beneficiary designations are not part of one’s estate, since they are distributed by contract. Jointly owned property goes to the joint owner at one’s death. Assets that are part of one’s estate, though, will need to go through court at one’s death, and should be passed on by a will or living trust.
If one dies without a living trust or will, state law governs who gets what. This is all fine and good, but there is a good chance that, in most cases, the way state law would pass on assets is not how you would want to pass on assets. These laws generally work by ranking inheritors and dividing assets based on a hierarchy.
Although it may be that those who don’t take time to prepare their own estates are also not terribly concerned what the state will do with their estate, it is important to think about who you want to receive your assets upon your death. One website out there, mystatewill.com, actually shows people how their assets would be disposed if they die without a will. This could be a good way to determine where you stand in that respect.
Another idea, and a smart one, is to speak to an attorney about setting up an appropriate estate plan. Doing so will ensure that your assets go where you want them to go at your death.
Source: Forbes, “I Don’t Have An Estate. Why Do I Need An Estate Plan?,” Deborah Jacobs, June 26, 2012