We often hear the word “Estate” but do we know what this common word really means? Well, if you don’t, you will find out soon enough. An estate is simply the net worth of an individual at a particular point in time. The net worth can include his or her assets which could be the individual’s cars, houses, investments, etc.
When a person kicks the bucket his estate is usually left behind for his loved ones and family to inherit or shared among themselves based on the decedent’s wish. Now, the properties of the deceased can’t be shared according to his wish if he died without planning his estate. This is why it is important that you plan your estate at the right time to ensure that all what you worked for are managed and distributed based on how you want them to.
Estate Planning Explained
Having provided the definition of an “Estate” understanding what estate planning entails shouldn’t be quite difficult for you. Since an estate can be regarded as the net worth of an individual, what does estate planning mean? To plan an estate, right? Well, kind of, but let’s make the answer more elaborate.
Estate planning is all about making plans regarding one’s estate in anticipation of death or incapacitation. In other words, estate planning involves plans regarding the distribution and management of one’s property upon death or incapacitation.
Most people believe that an estate plan is only activated upon the death of the estate owner. That’s absolutely wrong! Estate planning also covers the health care and certain financial decisions of an individual should he become incapacitated. Incapacitation is when an individual is unable to do something. This could be because of an illness or an accident. In situations like that, the individual is unable to make plans regarding how he wants to be taken care of, plans regarding his medical bills, including other important decisions that also revolves around his finances. If he made an estate plan before his incapacitation, all will be taken care of based on what is stated in the plan.
What Happens When You Fail to Plan your Estate?
Estate planning is very important because it gives instructions regarding how you want certain things to be handled after your demise or incapacitation. If you die with an estate plan, your properties will be shared and managed based on what is stated in your will, to be precise. If you end up dying without an estate plan, the state government will have to step in. What will the state government do? Well, it’s something you wouldn’t like, of course. The state will distribute your estate based on the intestate law.
Estate Planning Mistakes
Everyone makes mistakes but you can’t make a mistake when planning your estate as it could jeopardize your estate plan and make your efforts futile. Below are some estate planning mistakes.
Failure to Understand the Plan
So many estate owners make an estate plan without fully understand all that was drafted in the plan. They trust their estate planning attorney so much that they fail to ask questions regarding the plan they drafted. It is one thing to plan an estate according to your wish and it is another to understand the plan and the actions you need to take to ensure that the plan is well implemented.
It is the duty of the estate planning attorney to ensure that you understand the fundamentals of how the plan works, what you need to do to sustain the plan, and how the plan works for the designated beneficiaries. It is not really important that you know all the legal angles and why certain term is used, but knowing the basics is quite significant.
Other estate planning mistakes are:
- Old beneficiary designation
- Refusal to update your asset ownership
- You failing to refund revocable trust
Estate Planning Attorney Fort Lauderdale
Our estate planning Attorney can help you with your estate plan. They boast of the necessary expertise, experience and knowledge to help you plan an estate that conforms to your desire and adhere with the estate law of your state. If you reside in the city of Fort Lauderdale, Florida and you need the help of an estate planning attorney, don’t hesitate to contact us.