Congratulations on your marriage! Now that you’ve planned a wedding together, it’s time to plan your estate. Estate planning is an important part of setting up your marriage to be stress-free. And, you don’t have to do it alone. Creating your estate plan is much easier with the help of an estate planning attorney.
What Newlyweds Need to Know About Estate Planning
Estate planning is a somewhat nebulous term that can encompass a few different aspects of your financial life within your marriage.
Estate planning even includes simple tasks like updating your different financial accounts so they incorporate your new spouse. However, not all aspects of estate planning are that simple.
If you have a life insurance policy that you purchased before your marriage, you will may want to update who the beneficiary to your policy is. If you don’t yet have life insurance, consider purchasing life insurance. The purpose of life insurance is to be able to provide your spouse with some supportive income upon your death.
Existing Will or Trust
As one of the most well-known documents in the array of parts that make up an estate plan, you likely already have a will or know you need one. Whether you need to create one or to update one, it’s likely that you would want to add your spouse to your will. Even if you don’t, the law assumes you would want to and would give them a percentage of your assets anyway. That percentage depends on a few factors. If you prefer to decide on your own, how much you want your spouse to inherit, you will need to update your will.
Similar to a will, a trust can be established and be active prior to your death to manage your assets. A trust is used most often when someone has a significant number of assets. Your trust not only states what happens to your things upon your death but can put into place provisions for minors, dependents, pets, other assets, and what should happen in the event you become incapacitated.
Without a legally enforceable will, your estate will be settled based on the laws of your state, not your wishes.
After you are married, you may decide to share a bank account with your spouse. If this is the case, you’ll need to update your information on the accounts. It is also important to change your beneficiary with individual accounts such as retirement accounts or life insurance. This is also a good time to share your password and access information with your spouse.
Similar to your bank accounts, it’s important to update your information and beneficiary designation for your investment accounts. Even if you don’t have a trust, a beneficiary designated asset avoids probate as long as the beneficiary is living at the time of your death.
Health Savings Account
Just like your bank and investment accounts, it’s important that your health savings account is updated to include your spouse as a beneficiary.
The Difference Between Estate Plan and a Will
A will is an individual document that states your wishes for your things, assets, and dependents upon your death. A will is just one part that makes up the whole of an estate plan.
Your estate plan might include:
- Power of attorney
- Health care directive
- General Assignment
An estate plan is a comprehensive set of documents that state your wishes upon your death or what to do in the event that you’re incapacitated and can’t manage your own assets for a period of time. An estate plan needs to be created by an estate planning attorney.
Which One is Best For You?
A will is just one part of an estate plan. Everyone should have a will, at the minimum. If you have multiple assets or dependents, it’s very likely that you also need an estate plan.
To decide if you need an estate plan, ask yourself these questions:
- Are minors or dependents receiving an inheritance?
- Do your assets exceed $50,000 in real property or $150,000 in total assets?
- Is your privacy important?
- If you own a business, do you have a succession plan?
- What stage of life are you currently in?
- Are there special social circumstances to consider such as a blended family or loved ones with disabilities?
The more complicated your answers to these questions, the more likely you’re in need of an estate plan. No matter your situation now, you’ll eventually need an estate plan. Why not start sooner rather than later?
4 Reasons Why Newlyweds Needs an Estate Planning Attorney
Putting together an estate plan is no easy feat. There are multiple legal documents that must be written and many steps that must be followed to make sure your document is legally enforceable.
If you’re putting together an estate plan, it’s important to understand the laws in your state and seek i the help of an estate planning attorney. Not all estate planning attorneys are created equal. The issue is that you probably won’t know if you have a poor estate plan. Make sure to ask around for referrals and thoroughly interview your attorney. It is helpful to have a trust litigation attorney draft your estate plan. They can better foresee potential issues and draft in a way that minimizes litigation. And keep in mind, you do get what you pay for when it comes to estate planning.
1. It Avoids Probate Process
If your estate plan isn’t properly put together, it might not stand up in court. If your estate plan isn’t legally enforceable, it will force your loved ones to go to probate court to settle your estate, which defeats the purpose. It is not true that some estate plan is better than no estate plan. A poorly drafted estate plan can cost your family more than no estate plan at all. This is why it is so important to seek the help of a good estate planning attorney.
The probate process for a non-enforceable will costs your family money, time, and stress. Your estate will be settled based on the laws of your state and not your wishes, which could cause extra grief for your family and may not be what you intended. An estate plan created by an estate planning attorney will be legally enforceable and help your family to avoid the probate process.
The estate planning attorney fees are well worth the cost to avoid later costs such as court fees, much higher attorney fees, and taxes.
2. It Can Reduce Tax Liabilities
When you pass your assets on after your death, your family may have to pay an inheritance or estate tax. This can be costly for them. With an estate plan created by an estate planning attorney, you can avoid these tax liabilities.
Without an estate plan, your family will most likely face court costs and significantly higher attorneys fees to settle your estate after your death.
3. It Can Protect You in the Event of Incapacity
An estate plan is a comprehensive plan that includes documents with provisions for many different situations, including incapacity. In comparison, a will only takes effect upon your death. If you’re incapacitated but not dead, your will does you no good. But, a complete estate plan will include your wishes for such a situation.
4. The Estate Planning Attorney Can Guarantee A Professional Document
Your estate plan should be a professional, legally enforceable document created by someone knowledgeable. An estate planning attorney is just the person for the job.
To save your family time, money, and stress, you want to make sure that your estate plan is legally enforceable and understandable so they know how to follow your wishes. An estate planning attorney can help you to create such a document.
How to Find an Estate Planning Attorney Near You
If you’re ready to create your estate plan so that your spouse will know what your wishes are and be protected upon your death, consider consulting with an estate planning attorney in San Diego.
Get a Free Consultation With The Best Estate Planning Attorney in San Diego
Hiring the best estate planning attorney in San Diego ensures that your estate plan is legally enforceable and comprehensive so there are no questions later on.
Kam Law Firm Provides a Simple 2-Step Process
Kam Law Firm provides a simple 2-step process for you to get started planning your estate. The first step is to sign-up for a free KAM Law Firm consultation. This consultation allows you and the estate planning attorney to meet, understand your needs, and make sure you’re a good fit. If you decide to proceed with Kam Law Firm, the attorney will walk you through the estate plan design process and will provide you with a draft within two weeks.
The second step of the process is to come in for a signing meeting. Prior to the meeting, you’ll be provided an electronic copy of your estate plan to review and the opportunity to ask any questions that arise. When you’re ready, you’ll come into our office to sign the final version.