What is an Estate and an Estate Plan?
When people hear the word “estate,” some may think of movie-like mansions, sprawled across the mountains with swimming pools and acres of land. However, an estate refers to any assets that you have. This means anything that belongs to you. An estate plan contains a variety of legal documents that dictate how your financial affairs will be handled upon incapacity or death.
What Does it Mean to Say “Everyone has an Estate Plan”?
When someone dies without a will, the individual’s assets are still in their name. A will tells the courts who the assets should go to, but in cases such as these where there is no will, your state statutes dictate the distribution of the assets. Thus, “everyone has an estate plan.”
“Intestate Succession”
When the State decides the path of your assets based on statutes, this process is referred to as “intestate succession.” The statutes dictate a specific order that outlines where and how your money, jewelry, and other assets will be allocated. For example, upon death in the state of Michigan, for someone with a spouse and children, the first $150,000 of their financial assets will automatically be granted to the spouse.
So If I Already Have an Estate Plan, Why Should I Plan My Own?
By creating your own plan with a will or trust, you can alter and control the path your assets will take to the beneficiaries. Within a will, you can identify who will have the authority to administer the assets, who would be the guardian of your minor children and who will ensure that your bills are paid and your hard earned money is properly distributed. Having an estate plan allows you take control of your estate, rather than passively letting the State’s statutes, plan the distribution of your assets for you.
If you want control of your plan, discuss it with us by calling (877) YOUR-FIRM or visit us at theprobatepro.com.
