If you look at the statistics, the majority of people don’t have estate plans. One of the top reasons they give is simply that they think they’re too young. They’re waiting until they’re closer to the end of their life to make a plan for how their family should address this transition.
This may seem logical, but the reality is that no one can accurately predict when they’re going to pass away. One person may live into their 90s, while another passes away in a car accident in their 40s. Life is unpredictable, so waiting to make an estate plan is a gamble.
Dying intestate
If you neglect to make a plan and then pass away unexpectedly, it’s known as dying intestate. The trouble here is that state law takes over and determines how your estate should be distributed. This may mean that your estate has to pay more in taxes, and it may also mean that your descendants and other beneficiaries don’t receive the assets they expected. State law may not split things up in a way that even comes close to what you would have chosen on your own.
As such, it’s often better to make your estate plan as early as possible. Remember that you can periodically review and update your plan. If you gather significant assets over the coming decades, you can add those to your existing plan so that it’s up to date and reflects your total wealth. But making the plan early ensures that your family has that safety net in case something unexpected happens.
If you haven’t started your estate planning yet, it may be time to begin. Be sure you know exactly what paperwork you need and what legal steps to take.
