Common Estate Planning Myths

Common Estate Planning Myths

by Randall D. Armour, Esq.

Many common myths have developed and come up continuously in discussions about estate planning. It seems that most of these myths may have started as statements taken out of context which were then passed around as rumors or in gossip and have somehow become widely held beliefs. I have found that these myths can be dangerous as many people have not done proper planning because they have relied on incorrect information. This article discusses some of the most common myths.

1. If you have a will, probate will not be necessary.

While having a will may be beneficial in naming someone to administer your estate and identifying your beneficiaries, in most cases, having a will means that probate will be mandatory. Probate is the legal process of distributing assets to beneficiaries. The will simply provides the probate court with instructions. Probate assets are commonly held up for 1-2 years before being distributed.

2. Estate Planning is only necessary for the rich or elderly.

Almost everyone, regardless of age or economic status, should consider some kind of estate planning for issues such as naming the person who will handle your affairs, naming the guardian of minor children, planning for incompetency and health care decisions.

3. If you don't have a trust or will, the government will get it all.

Not having a will or trust almost always increases probate costs and delays. A proper estate plan may also result in a substantial tax savings for the estate. However, if you have not planned your estate, your beneficiaries will be determined by state law and the government will only end up with the assets if no heirs can be found.

4. You can do it on your own and save money with a "do-it-yourself" kit.

In many cases, attempting to prepare your own documents to address the complex legal and tax issues associated with estate planning can lead to additional costs when it is determined that the plan is not effective due to failure to address all issues. Remember, what you get is what you pay for.

5. Estate Planning is a one-time deal.

Your estate plan should be reviewed on a regular basis, every 1-3 years to make sure that the plan continues to carry out your wishes and has not been impacted by any changes in the laws.

Relying on these and other estate planning myths can lead to disastrous results. Find out the facts, and have a qualified professional assist you in executing a plan that will give you peace of mind and provide security for your family.

Attorney Randall D. Armour practices in the areas of estate planning, probate and trust administration. Contact Law Offices of Randall D. Armour at (661) 259-0003, and mention this article.