Many people assume that the only purpose of estate planning is to decide who receives their property after their death. However, there is much more to it than choosing heirs to receive your property. Comprehensive estate planning can include incapacitation planning, asset protection, and tax planning. Contact a Texas estate planning attorney if you want to know more about how our firm can protect you and your family now and long after your death.
Seven Reasons Why You Need an Estate Plan
Estate planning is important for a variety of purposes. Seven of the important purposes of an estate plan are:
1. Choose Your Heirs
While it is not the only reason for an estate plan, choosing your heirs is an important purpose of estate planning. Without a valid will, the state decides who receives your property. Intestate succession dictates how much your heirs may receive, as well.
2. Choose a Guardian and Trustee for Minors
If you have young children, you need a will so that you can choose who will care for and raise your children if you die. If you do not have a will, the state may decide who cares for your child if your child’s other parent is unfit of not living.
3. Prevent Guardianship and Conservatorship for You
Incapacitation planning can prevent someone from being appointed to handle your finances and make personal decisions for you in the event you are unable to do so because of an illness or injury. Without a financial power of attorney and medical power of attorney, you cannot be sure who might make decisions for you if you become incapacitated. You can use medical directives and living wills to ensure that your wishes are honored regarding end-of-life care and treatment.
4. Leave Property to Friends and Charities
Without a will, you cannot leave property to friends or charities. These parties are not considered heirs under the state’s intestate laws. Also, distinct relatives may not receive anything under intestate laws, depending on your family situation at the time of your death. Therefore, if you have anyone special in your life that you want to be included in your estate, you need a will.
5. Asset Protection
Estate planning also gives you a way to protect assets from creditors during and after your lifetime. By using trusts, you can title property in the trust name to prevent your creditors, your heirs’ creditors, and other parties from seizing the property for debts or other obligations. Trusts can also protect family businesses and family heirlooms from being transferred to non-family members.
6. Estate Planning To Reduce Taxes
A comprehensive plan can help you reduce the tax liability of your estate and your heirs. With a careful strategy of gifting, using beneficiary designations, and placing the property in trusts, you may avoid all estate taxes and gift taxes.
7. Protect Your Privacy With Estate Planning
Although this is a public process, trusts are private. If you desire to keep your affairs private, you can use one or more trusts. The property in a trust passes directly to beneficiaries without passing through probate. However, you still need a residuary will to ensure that none of your property becomes subject to the state’s intestate laws.
Contact a Texas Estate-Planning Attorney if You Have Questions
A Texas estate planning attorney can answer your questions about estate planning, including why you need an estate plan. Schedule a consult with one of our experienced estate-planning lawyers today. With the help of an experienced probate lawyer, you can ensure that your family is protected and has what they need after your death or incapacitation. That is one of the most important purposes of estate planning.