Why Everyone Needs an Estate Plan
Everyone needs an estate plan. This is not a sales pitch for lawyers. Quite the contrary, creating an estate plan makes lawyers lose out on money. Who doesn’t love that idea?
By creating an estate plan, you get the wonderful pleasure of avoiding probate. Probate is a long process that I will discuss in future blog posts. Suffice to say you should try to avoid probate.
Also, avoiding probate is the way you save money. Under California Probate Code Section 10810, an attorney gets paid $4,000 for an estate worth up to $100,000 and the fees keep going up based on the value of the estate. What this code section tells you is that the smallest of estates (an estate up to $100,000) will pay more in probate fees than the average estate plan will cost, even if you go through an attorney.
In addition, an attorney cannot charge a client more than the code section permits. This means that some attorneys will not want to take on a probate for an estate that is small, because the time commitment substantially exceeds the attorney’s hourly rate.
In short, don’t leave your family having to pay an attorney probate fees, when it is so much cheaper to create an estate plan.
The benefits to your family are even more important than any legal or financial benefits of creating an estate plan. With a proper estate plan, you ensure that instead of leaving your family with a mess, you give your family at least some peace of mind.
All the different components of an estate plan allow you to make sure that your assets are divided properly; it assures that there will be no doubt as to your wishes; and it assures that your family will be taken care of when you eventually pass away (hopefully many, many years from now).
How To Create Your Estate Plan
Now that you understand at least some of the importance of an estate plan, how should you go about creating your estate plan? There are many options out there. Although it may sound self-serving, the best way to create an estate plan is through an attorney. Honestly, why else would people go to law school and spend years perfecting the profession? Either because we are sadists or because legal matters require expertise, or maybe both.
If you can’t afford to have an attorney create your estate plan (although see above in “Avoiding Probate” why it is cheaper in the long run) there are many online services that can either guide you through the process or create an estate plan for you. Also, there are many books that will guide you through the process.
Although, I will tell you, you get what you pay for.
At the end of the day, create an estate plan. You will definitely sleep better at night knowing that you are not leaving a mess behind for your family.
Information on this site was believed to be correct at the time of posting. Also, readers should be careful about relying on any information found online. Please consult a lawyer to ensure accurate compliance of the law within your jurisdiction.