Why Estate Planning Is Important

Do you ever wonder if estate planning is important, or if it applies to you and your assets? If so, here are three things to consider.

1. You need an estate plan to distribute your assets.

To control how your assets will be distributed when you die, you need an estate plan. If you don’t have one, the state government will step in and distribute your assets according to their default rules. And, most people want to control how their personal property is divided, rather than have the government take charge.

Even if you don’t have many assets, you likely have at least one possession that holds value, whether it is a small bank account, an insurance policy, an old house, or a piece of land. You may not own enough to need a complicated estate plan, but you will need to use at least a couple of simple estate planning tools to distribute what you do own.

2. You need an estate plan to care for your loved ones.

Estate planning is not solely about distributing assets. It is also an opportunity to prioritize the wellbeing of your loved ones and use your death to care for them in any way you can. We call this kind of estate planning Relational Estate Planning®. If you approach estate planning with the mindset that it is not only about distributing your assets, but also about passing on values, family heirlooms, your legacy, and your love, the end of your life can be your last gift to your family, friends, and circle of influence.

It’s not that Relational Estate Planning® doesn’t see your assets as important. Rather, it views them as tools to care for your loved ones, instead of making them the primary focus of your plan. Death provides a unique opportunity for you to impact your family and close friends, and that’s what your estate plan should prioritize. Using a combination of traditional tools, such as wills and trusts, and non-traditional tools such as ethical wills, the gifts and memories list, and the estate guide and inventory, Relational Estate Planning® helps you:

Protect and provide for loved ones
Avoid conflict
Leave a legacy
Preserve special memories
Ease burdens related to your passing

3. You need an estate plan to be prepared for the future.

This is the ultimate reason for estate planning. You need a plan for your assets, and you need a plan for your relationships, but more generally, you need to be prepared for whatever the future may hold.

Death and aging can feel scary and overwhelming, and it’s easy to avoid thinking about them. But without a plan, you risk all kinds of end-of-life issues, such as making things hard for your family, paying too much in taxes, having the state take control, people fighting over your possessions, and more.

When you create a thorough relational estate plan, though, the opposite is true. Being prepared means you no longer leave things to chance. Instead, you ensure that things go as smoothly as possible for your family, that the instructions about your assets are clear, and that you are the one in control-not the government. Believe me, the confidence and peace of mind you will experience by being prepared will be well worth the effort.