Statistics tell us that over half of all Americans do not have a comprehensive estate plan. Millions of Americans do not even have a basic Last Will and Testament. One of the most common reasons given by people who have not created an estate plan when asked why they have yet to create one is that they do not feel that they have enough assets to warrant bothering.
If you have minor children, or ever plan to have them, then you have the most important reason of all to create an estate plan even if your financial assets are modest and here are several reasons why:
Misconception #1 – I’m married so my spouse will be given custody of our child so I don’t need a Will right?
While this is true in most cases, what happens if you both die in a horrible car crash? Don’t assume that your parents/sister/aunt will step in and take custody of your child without discussing the possibility with them. Even if they are willing to do so, a court will still need to legally appoint them which takes time. Your Will allows you to indicate who you want as guardian of your children which can make the legal process easier and faster if the need arises.
Misconception #2 –My children will get all my assets anyway right?
In the absence of a valid Will, your assets will be divided according to state intestacy laws. Your children will likely get some of your assets, but may not get all of them. If you want everything to go to them, you need to say so in a Will.
Misconception #3 – My spouse can handle assets left for my children so I don’t need to worry about an estate plan right?
Again, if your spouse dies at the same time, then whoever the court appoints as guardian could also be appointed as conservator/guardian of their estate, meaning they will control any money left behind. Even if your spouse outlives you, he or she could die at a later date. Absent an estate plan that you created, any assets you left behind would then be part of his or her estate and you have nothing to say about what happens to them. Creating a simple trust can ensure that whatever assets you have at the time of your death actually go to your children.
The Law Offices of Barton P. Levine is a member of the American Academy of Estate Planning Attorneys.