Why Do I Need an Estate Plan If “I Don’t Have an Estate”?
Before you can answer the question of, “Why do I need an estate plan if I don’t have an estate?”, another question must be answered first, “What is an estate?”. An estate is all of the assets that you own or have a legal interest in at the time of your death. Your estate would include real property (i.e. land or building), and all other property (i.e. vehicles, boats, mobile homes, motorcycles, bank accounts, stocks or bonds, ebooks, audiobooks, mp3 music, your digital presence, your “stuff,” etc.). Based on this very broad definition of estate, everyone, young and old, has an estate.
Now that you know what an estate is comprised of, you may be reconsidering your need for an estate plan. “But, I don’t have a lot,” you say. Whether or not you have “a lot” is not the issue. The issue is whether you want the peace of mind and the control to decide who would receive the estate you have and how your beneficiaries would receive it. To whom do you want your estate to go? To your spouse (if you have one), to your kids (if you have some), to your parents (if still living), to your siblings, or nieces and nephews? If you like that order, then that is the State’s estate plan for you if you do not do your own. If you do not like that order because you want your estate to go to your significant other, or your friends, or adopted siblings, or to some but not all siblings, or to charities, you need to do an estate plan.
If you decide that you are okay with the State’s estate plan for you, you still need to do an estate plan because estate planning involves more than what would happen to your estate at your death. It also includes who would manage your estate if you become incapacitated. Who would help you pay your bills? Who would make medical decisions on your behalf? Your parents? Your spouse? Your significant other? The answer is “no one.” You need to name an agent in your Powers of Attorney for Financial and for Health Care to act on your behalf. If you do not have Powers of Attorney, the alternative is for someone (most likely a family member) to petition the court for guardianship, which is the authority to make financial and health care decisions on your behalf. If you want to make matters simpler for your loved ones, then at the very least, you should consider executing Powers of Attorney for Financial and for Health Care and a Directive to Physicians, regardless of the size of your estate or whether or not you like the State’s estate plan for you.
If you want to learn more about estate planning and what documents you need to have proper estate planning, please call Rehberg Law Group at (206) 246-8772 to schedule a no-cost appointment with one of our attorneys.