In India, a there is a story of a group of blind men who wanted to understand what an elephant is. So they finally encountered a mahout who would let them touch an elephant. The first touched the tail, the second a leg, the third a tusk, and the fourth the trunk. As they went on their way, they talked about their impressions of an elephant. Not surprisingly, their perspectives were all quite different.
Most of us have some experience dealing with an estate, either personally, or knowing someone who handled an estate. But like the blind men touching pieces of an elephant, it’s hard to grasp the total reality of an estate plan without a guided tour. Here are four common myths about estate planning that I hear all the time in my practice.
An Estate Plan Is Only for My Kids
Are you planning on having your family or children sue you? If not, do you have an effective Durable Power of Attorney and Advance Health Care Directive? You’re leaving yourself wide open for conservatorship proceedings if you don’t have the right legal documents in place before you can’t make your own medical, financial, and legal decisions.
Besides, I imagine that you really do care about other people in your life. I also imagine that the last thing you would want to do to them is to inflict a costly legal mess on them, in addition to the grief of losing you would cause.
Trusts Are Only for The Rich
Yes, the rich have specific trusts designed for their financial needs, but the rest of us have far less complicated trusts designed for our needs. You may not need to plan for estate taxes, but wouldn’t you like to provide protection for your spouse and children from future financial dangers?
A Will Is Good Enough
A will still requires probate court to review the will, approve who the beneficiaries are, and approve the complete distribution plan, and ensure that your executor has complied with all the legal steps and processes. In California probate is an expensive process that takes months, possibly years to complete and will cost your family thousands in fees. It’s also a completely public process – exposing all of your assets and personal information to anyone who cares to look.
An Estate Plan is Way Too Complicated
Is your favorite mode of transportation a single speed bike? Not too much complexity there. Personally, I have no idea all of the things that go on under the hood of my car, but I do understand brake, gas, and steering. I can even drive a manual stick shift without grinding the gears believe it or not. Working with a good estate planning attorney, you can pick out the right estate planning vehicle for your family’s needs. The attorney can also show you how to “drive” your estate plan, so you can be confident that your family is going to be well taken care of in the future.
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