Estate Planning Vault

Common Misconceptions About Estate Planning

The following are some widespread misunderstandings regarding estate planning:

• Estate planning equates to drafting a will. While a will may be an integral part of one’s estate plan, an estate plan can (and should) include much more. A will simply indicates how assets are to be distributed upon an individual’s death, whereas an estate plan is a comprehensive approach for maintaining one’s estate for the benefit of one’s heirs.
  
  
• Estate plans come into play at death. While many components of an estate plan may take effect upon an individual’s death, other components may also be used during one’s lifetime. A well-rounded estate plan will contain provisions to address handling one’s medical and financial affairs should the individual become incapacitated.
  
• Those with jointly held assets don’t require an estate plan. Although holding assets jointly may allow probate to be avoided (at least until the death of the last surviving owner), there may be issues with estate or gift taxes or creditors that having an estate plan may mitigate. Additionally, without an estate plan, upon the death of an owner of jointly held assets, surviving owners will automatically become owners of the deceased’s portion. This may not be the intention of the decedent.
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• “Common sense” will dictate who receives an individual’s assets upon death. While true, if one dies without an estate plan, state statutes will dictate how assets are to be distributed; state laws may not be aligned with an individual’s goals. To make sure one’s intended heirs receive their inheritance; the services of an estate planning professional should be secured.

Source: www.PressandGuide.com, 11-12-06