Did you know that the majority of people haven’t done their estate planning yet? The exact numbers do vary from one study to the next, but some have found that it could be as high as 67%. For most Americans, estate planning is just something they haven’t taken on yet.
This is a very curious problem, as everyone knows that they will eventually have to pass anything they own onto the next generation. This typically means their own children and heirs, but even those without children could choose different beneficiaries. In short, everyone will need an estate plan, so why doesn’t everyone have one?
They’re going to make the plan at a later date
The main reason the people give when asked why they haven’t done estate planning is simply that they’re going to do it in the future. They do want to make an estate plan and they do understand that they need it. They know that it’s important. It’s just something that they’re going to do in 10 years or after they retire or when they have grandchildren.
There are some other reasons that people will sometimes give, as well. Some have mentioned thinking that they don’t have enough assets for an estate plan to make sense, for example. Others will say that they just don’t know what paperwork to use but they wish that they already had a plan. But the majority of people are just putting off their planning and procrastinating.
This is a risk for your heirs
This can be a serious risk for your heirs, especially when they have unique circumstances that you want to address.
For instance, say that your heir has special needs and will require certain types of government assistance and benefits after you pass away and can no longer take care of them. If your assets simply pass directly to that heir, they may become ineligible for those benefits.
If you set up a special needs trust, you may be able to retain their eligibility while still allowing your financial assets to improve their life. But failing to make an estate plan means that they’re not going to have these types of tools at their disposal and it could negatively impact them – even though you didn’t expect that or anticipate it.
You can see how risky this is because you never know when your family will need that estate plan, so be sure you know what steps to take to get your plan in place as soon as possible.