At Parks & Jones, estate planning is a large part of what we do. But what is estate planning? In this post, we'll answer some of the most common questions we get.
Does everyone have an "Estate"?
You are the owner of an estate. Yes, you! It might sound like something only the “rich” have, but it’s true, we all have an estate. The term estate doesn’t just refer to a large amount of land that is the property of one person. It also refers to everything a person owns—your home, your car, personal possessions, the money in your bank account, etc. Whether you’re living in a luxurious mansion or renting a shoddy studio, you have an estate. When you die, you will leave behind all of that “stuff,” which is why estate planning is so important.
How do I make an estate plan?
What is estate planning? When you plan out who will receive the things you own after you die, you are doing estate planning. Some estate plans are complex and others are quite simple. Consulting an attorney who will help you carefully plan a list of instructions detailing what you would like to be done with your estate when you die makes the process much easier and ensures you cover all the bases. Much like you would provide a set of clearly written instructions for a babysitter for your child, an estate plan puts in writing what happens to you and your property if you should become disabled and/or pass away. Unless you absolutely do not care what happens to your estate after you die (a very rare sentiment), you need to start planning now.
What does estate planning involve?
While many people ask "what is estate planning", many have more specific questions – such as "what does estate planning involve?" At its most basic, estate planning involves deciding who will receive pieces of your estate, what they will receive, and when they will receive it. However, there are many other factors that you should consider adding. For example, you also ought to include:
Instructions for your care if you become disabled
The naming of a guardian to take care of minor children
Disability income insurance and/or long-term care insurance
Preparation for the transfer of your business
Protecting your assets from lawsuits
What happens to your estate if you go into a nursing home
Provisions for family members with special needs (without disrupting government benefits) or loved ones who are financially irresponsible or may have trouble in the future with creditors or divorce
Shouldn’t I wait until I’m older?
No. By then, it could be too late! You don’t know the date of your death, and unexpected things happen all the time. If you don’t plan these things out now and you die at a younger age than you anticipated, the state will decide how to divide your assets. Your spouse will likely receive only a fraction of your estate (which may or may not go against your wishes), and if you and your spouse die at the same time (or your spouse is already deceased), the court will appoint a guardian for your children and a conservator to manage the money. Wouldn’t you rather decide these things for yourself?
I’m not wealthy. Does estate planning really matter for me?
Certainly. Everyone should create an estate plan. In fact, estate planning is often more important for those with modest financial wealth because they and their families cannot afford to lose any assets.
So do I just do an estate plan once and then I’m finished?
No. Estate planning is an ongoing process, not a one-time task. You will begin estate planning early in your life, when you still have many more years ahead of you. As those years pass, your family, friends, and financial situation will likely change. Whenever a major change occurs in your life, you should review and update your estate plan.
Who can help me prepare my Estate Plan?
If you live in Southwest Missouri and you are wondering "what is estate planning", be sure to give the attorneys at Parks & Jones a call at (417) 823-9898 to schedule a FREE consultation. With their knowledge, expertise, and combined 20+ years of experience with estate planning, they can help you plan for your future with confidence. There are many details to decide and decisions to make, but once you’re through, you’ll have a very wonderful thing: peace of mind!