An Estate Plan: Do You Really Need One?
Too many of us neglect to plan for how our assets will pass to our family and who will control and be most involved in that process. Some feel that they don’t have enough property to warrant a formal estate plan or have fears about confronting end-of-life issues altogether. However, not only is estate planning tailor-made for your personal situation a must for ensuring that your property passes to your intended beneficiaries, it can also protect you during your lifetime from unlikely, but very possible, tragedies.
You may have spoken to friends and family members who say that their loved one died without a will, and everything went smoothly, nonetheless. It is true that the “probate process” in Texas is one of the least complex and cost-efficient systems in the country. In most traditional family situations, Texas law provides for property to pass to spouse and/or children in manner which most people would prefer. However, when are family situations these days traditional?
Importantly, in blended family situations, passage of an estate under the Texas Estates Code results in strange, likely unintended consequences. For example, for a married person who dies, his or her surviving spouse receives a life estate (right to occupy for the survivor’s natural life) in just 1/3 of the deceased spouse’s separate real property.
In the end, hardly anyone avoids having to execute some sort of legal documents in order to complete passage of title to assets, even in a simple estate.
A COMPLETE ESTATE PLAN IS A MUST
Often, failure to designate what assets pass to which beneficiaries sometimes leaves family members in difficult situations in which they must reach an agreement involving deeply-held feelings at a time when emotions are raw. Putting a definite plan in place takes this burden off surviving spouses, children, and other family members. Additionally, estate planning avoids many different pitfalls which might exist in your personal situation. An example of this problem can arise when failure to properly plan may disrupt governmental benefits received by a disabled family member.
Financial and medical powers of attorney are also an essential part of your estate plan to ensure that trusted institutions, family members, or friends are designated to make decisions for you in the event of mental of physical incapacity. Such planning helps to avoid the necessity for costly and needless guardianship proceeding, in which the court exercises control over those decisions. A good estate plan can also include making changes to your agreements regarding bank, investment, and other accounts, as well as current beneficiary designations on retirement plans, insurance policies, and other non-probate assets.
We find that clients usually over-estimate the cost of implementing a necessary estate plan. If you have questions about your need for an estate plan and what that means in your unique situation, contact us today to discuss your needs for proper planning.