Why is Estate Planning Important?

Proper estate planning is vital - not only for you, but for your family. There are many misconceptions about estate planning that can cause major problems or cost your family their fortune. Many believe that saving on federal estate taxes is the main reason for planning, but family estate plan-ning is so much more than avoiding taxes alone. Let’s take a look at some of the biggest contributors to loss of assets and family frustrations that result from improper estate planning, and discover their solution.
    Probate - In most cases, Probate is re-quired to pass title and ownership of a deceased person’s property to his or her heirs. If you have a Will, you WILL go through Probate. It can be a time-consuming process, from nine to twenty-four months. It can also be extremely costly - usually between 4%-10% of the value of your estate, which can be even more devastating to smaller estates. It’s a misconception that if you have a smaller estate you don’t need to do estate planning.
Probate proceedings are also public records, and anyone may find out about your private affairs. If you value your privacy and want to keep your hard earned assets, you will avoid Probate. The good news is that by setting up a well-written, fully-funded Revocable Living Trust, you can avoid the unnecessary time and expense of Probate.
    Joint Tenancy - Joint Tenancy is a way to own assets with someone else, usually a spouse or child. While owning assets such as a home or bank account in Joint Tenancy may seem advantageous, the tax and legal
problems that may arise can be mind-boggling. The perils of Joint Tenancy can include:
 Only delays Probate, does not avoid it.
 Capital Gains Taxes are not avoided.
 Subject to Court Judgments or Creditors.
 Unintentional Gift Taxes you don’t even know about.
 Control issues with Co-Owner.
 Accidental Disinheriting.
There are many planning options that are far safer than owning property in Joint Tenancy - one of those ways is with a good Living Trust.
    State Estate Tax - Many states have a lower estate tax than the fed-eral estate tax. That’s why it’s important for you to have a qualified estate planning professional work with you to achieve your goals. They can help you sort through all the problems, and find the right solutions for you.
    Incompetency - Without a proper estate plan, any relative may petition the Court to be appointed as your Guardian or Conservator if you become incapacitated or are declared incompetent. Because you are not able to say whom you want, the Court will appoint some-one. Remember that a Court appointed Conser-vator has total control over EVERYTHING you own.

Advantages of a Living Trust - Establishing a Living Trust is an effective way to avoid many pitfalls of improper estate planning. A Living Trust avoids Probate, preserves your privacy, eliminates challenges to the estate, establishes Conservators, minimizes estate taxes, takes care of minor or disabled children, and allows YOU to be in continuous control or management of your assets.