4 common myths that discourage estate planning in New York
There are many myths surrounding the estate planning process that often discourage people from developing a binding estate plan.
For some people in New York, estate planning is low on their priority list because of the many myths they have heard about the process and its importance. Here are some of the most common myths about estate planning, and why they are untrue.
1. You can be too young to estate plan
Those who have yet to develop an estate plan should do so as soon as possible, regardless of age. It is difficult to know exactly when an estate plan will be needed, but it also better to be protected than to lack these basic protections. Even those just starting out in life should remember that even though their estate plan does not have to be extensive, it should still exist in basic form.
2. Planning an estate is only for the wealthy
Just like many young people think an estate plan is unnecessary for their stage of life, many also believe the creation of an estate plan is only for those with significant assets. However, estate planning is not just for the wealthy because its focus is on ensuring a person’s finances are taken care of in case he or she is incapacitated, ensuring his or her healthcare is carried out in a pre-determined manner and ensuring a person’s children or heirs are taken care of when he or she finally passes away.
3. Unless a will is in place, your property is seized by the government
Those who die without a will or trust in place will have the ownership of their assets determined by the laws in the state they called home before dying. For example, in some states, a surviving spouse will receive everything, but in others, the spouse must share assets with surviving parents and children. However, without a trust or a will, assets will typically not go to a live-in partner or stepchildren.
4. A trust is needed to avoid probate
Avoiding probate is one of the primary reasons why people draft a trust, but there are other methods that are just as effective. For example, annuities, life insurance and any funds held in a retirement plan, like a 401(k) or an IRA, are exempt from probate as long as one living beneficiary is named on the account.
Reach out to an attorney
Those in New York who are anxious to set up an estate plan may still have many questions about the intricacies that surround the planning process. In this situation, a lawyer should be contacted for guidance and assistance.