Despite knowing how important it is to create a thorough estate plan, over half of all Americans do not have one. Although various reasons are given for failing to create an estate plan, one of the most common reasons is that people who have estates that include only modest assets think an estate plan is not necessary. If you have minor children though, you need an estate plan without regard to the value of your assets and here’s why.
Although you may not have assets that are worth a considerable amount in monetary terms, you may have numerous items that are invaluable in emotional or sentimental terms. To ensure that those family heirlooms or personal items are not sold when you die, you need to create at least a Last Will and Testament indicating who you wish to have those items upon your death.
Another crucial reason why you need an estate plan revolves around guardianship of your minor children. If you are married to the parent of your child, do not assume that this solves that issue. What happens if you both die at the same time in a tragic accident? By executing a Will, you have the ability to nominate someone you trust as guardian of your children in the event a court needs to appoint one at some point.
Finally, who will manage whatever assets you do have to leave behind for your children? Again, if your spouse dies at the same time as you, your minor children cannot inherit directly, meaning that someone will need to be appointed to control any money or property you leave to them. Your estate plan is the only chance you have to decide who this person will be.
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- IRS Confirms Grantor Trust Status Alone Does Not Cause a Step-Up in Basis - October 26, 2023
- Understanding the Importance of the Simultaneous Death Act - October 19, 2023
