Many people procrastinate when it comes to estate planning. In fact, surveys continue to show that around 45% of Americans have not done any estate planning. Most will readily admit this is something they should do, but they just keep putting it off. Maybe you know someone like this. Maybe it’s you!
Here are the top five reasons people procrastinate about estate planning…and some information that may finally get them (or you) to act.
Reason #1: I don’t have time.
Yes, it does take some time to put an estate plan in place. You will need to gather your financial information, find and meet with an experienced attorney, make some decisions, approve and sign the documents and, if you have a living trust, transfer your assets to it.
But not taking the time to plan now will end up taking more time for your family later. If you own assets in your name and you don’t plan now, your family will likely have to go through probate when you die. Probate often takes from nine months to two years to complete. That’s because probate moves on the court’s and attorney’s schedules, not on your family’s schedule. Your family will have very little say in how quickly things can happen.
If you have not taken the time to plan and you become incapacitated, the court may find you are not able to handle your affairs. If that happens, your assets and your care will be put under the court’s supervision in a guardianship/conservatorship. Your family will be required to appear in court for numerous appearances, keep careful bookkeeping records and submit all expenses to the court for approval.
Taking the time to plan now will save your family a lot more time when something happens to you later.
Reason #2: Estate planning is expensive.
Yes, it is an upfront cost, but most people come to understand that the cost of estate planning is quite a bargain compared to the potential costs at incapacity and death. Simply put, if you don’t do anything, your family will likely end up paying much more than it will cost you to plan now.
The costs of incapacity
If you own assets in your name and you become incapacitated due to illness or injury, your assets and your care can be placed in a court guardianship/conservatorship. This is not free. All costs (attorney fees, accounting fees, court costs, and so on) will be paid from your assets. If your family needs money to live on, they may have to ask the court for a living allowance, which may or may not be approved, depending on the value of your assets and the cost of your care.
The costs at death
This process does not replace probate when you die; your family will have to go through the court system again. Probate costs are usually estimated at 3-8% of an estate’s gross value (before any debts are subtracted). That means more expenses and less for your family. Also, if you don’t have a valid estate plan, your assets will be distributed according to the laws in your state, which probably would not be what you wanted. If you have children, they will likely share in your estate, which might not give your spouse enough to live on.
You pay for car insurance and homeowner’s insurance to protect you against a loss that, odds are, won’t even occur. Estate planning protects all your assets—not just one or two. And, unless you know something we don’t, dying is something that will happen to all of us some day!
Reason #3: I’m not old enough.
Estate planning isn’t just for “old people.” Younger people always seem to think they will live forever. But the reality is that anyone, at any age, can become incapacitated or die from an illness, injury, accident or even a random act of violence. Almost every day we read about someone whose life was cut short or changed dramatically in an instant. None of us likes to think about our own mortality—which is why so many families are caught off guard and unprepared when incapacity or death strikes.
Reason #4: I don’t own enough.
Estate planning isn’t just for the “wealthy.” Costs for a court guardianship and probate usually take a greater percentage from smaller estates, which can least afford it, than from larger ones. No matter how much you own, you probably would rather see it go to your loved ones than to unnecessary court costs and attorney fees.
Reason #5: It’s confusing. I don’t know what to do.
Confusion, uncertainty and indecision can be paralyzing. But an experienced estate planning attorney can help you understand the process and guide you through difficult decisions. It’s why attorneys are called “counselors at law.” They have seen what countless other families have gone through, and they know what has worked and what hasn’t.
Perfection is impossible. Don’t postpone getting this done because you are trying to come up with the perfect plan that covers every conceivable possibility. Your estate plan is a snapshot of you, your family and your assets right now—not one year, five years, or twenty years from now. No one can predict what your personal, family, or financial future will be. Go ahead and do this now, then change it as your situation changes.
Why we do estate planning
We do this for those we love. We want to make sure our assets will go to the people we want to have them, with the least amount of delay, hassle and expense. We want to keep our family from having to deal with the courts if we become incapacitated and after we die. We want our loved ones to know that we care about them, we want to provide for them and we want to protect them.
Yes, we plan our estates for those we love. And when we do, we get a huge benefit, too—peace of mind. You will be able to fully enjoy living when you know you have done what’s best for you and your family.
How to stop procrastinating
Step 1. Set a deadline. Make it around a birthday, anniversary or after taxes. Put it on your calendar and make the time.
Step 2. Become educated on your own time. Read the information on our website and start thinking about how it might apply to your situation.
Step 3. Call our office to make an initial appointment. If you are concerned about costs, be upfront about that so we can make some suggestions. You may be able to start with basic documents or pay by credit card.
Step 4. Put a plan in place now, based on your current financial/personal situation and the laws currently in effect. You can (and should) change it as your life and laws change.