Many Connecticut residents mistakenly believe that estate planning only benefits older people with extreme wealth, but the benefits of estate planning are available to many people outside of this group. A well-planned estate is a useful tool for anyone who owns assets that they can use to take care of a loved one.
What is a person’s estate?
An estate represents the sum total of everything a person owns. Possessions that commonly make up a person’s estate include:
- Life insurance
- Bank accounts
- Personal possessions
Creating an estate plan
Estate planning will allow a person to control which people and organizations benefit from their possessions when they are gone. Planners can organize their affairs and create a written record of their intentions.
Why an estate plan is necessary
A person who dies without a will is said to have died “intestate.” What happens to the possessions of the person is then decided by the laws of the state. A probate court will appoint a representative to distribute any belongings. This job usually falls to a spouse or other close family member. The court will appoint a trustee if no family member is available.
One problem with this process is that the assets that make up the estate cannot be touched until the probate process is complete. Months and even years can pass before loved ones have access to the estate.
A second major benefit of an estate plan is the protection it provides for minor children. This protection takes on greater importance for people who die without a spouse to care for their children. In the absence of a will, a court will appoint a grandparent or other person as the child’s guardian. When no close family member is available, a child may become a state ward. An estate plan allows parents to decide on a guardian for their children in the event of their demise.
Another reason to create an estate plan is the opportunity to create a durable power of attorney and appoint a health care proxy. These documents will honor the planner’s wishes regarding medical treatment if they one day become incapacitated.
Estate planning provides numerous protections that are beneficial to anyone who owns assets or is a parent. Individuals with questions regarding how an estate plan may benefit their particular situation may find the answers they need by speaking with an attorney.