Estate planning is essential to providing for your loved ones, protecting your assets, and ensuring your wishes are fulfilled after you are gone. Yet, many are unsure when to start estate planning. While many believe it only becomes necessary later in life, beginning the process somewhat earlier offers significant benefits.
At Massingill, we offer estate planning services to meet your unique needs. With transparent flat-fee pricing, secure online document access, and unlimited revisions to document drafts, we make the estate planning process straightforward. Contact us today to set up a consultation.
What Does Estate Planning Involve?
Estate planning involves creating legal documents to establish what should happen to your debts and assets when you die. You typically also create documents that provide direction for your loved ones if you become unable to communicate your wishes or manage your affairs.
Wills
In your will, you:
- Specify who inherits which of your assets,
- Name guardians for minor children, and
- Include necessary instructions for managing specific property.
For a will to be valid, the will’s creator (the “testator”) must:
- Be at least 18 years old and of sound mind when they make the will,
- Record the will in written form, and
- Sign the will.
Two individuals must witness the testator sign the will and then sign it, too.
Trusts
Trusts are versatile tools offering additional control over asset distribution and management. Many trusts also bypass the often lengthy probate process.
There are several types of trusts, including:
- Living trusts—created during the creator’s (“grantor’s”) lifetime;
- Testamentary trusts—funded upon the grantor’s death;
- Revocable trusts—can be altered or revoked during the grantor’s lifetime; and
- Irrevocable trusts—typically cannot be altered or revoked.
You may use a trust to, for example:
- Provide for a special needs child,
- Qualify for Medicaid long-term care coverage without sacrificing assets,
- Protect wealth for future generations, or
- Support charitable organizations.
Trusts may have various other purposes that meet your specific needs.
Powers of Attorney
A power of attorney grants someone you select the authority to act on your behalf in financial or health-related situations. The document takes effect if you become unable to make your own decisions.
Advance Directives
An advance directive outlines what medical treatments you would prefer to receive or not receive in specific circumstances, like:
- Life-sustaining treatment like ventilators or feeding tubes;
- Treatments for pain management and palliative care; and
- Resuscitation or do not resuscitate (DNR) orders.
Advance directives provide clarity for your loved ones and healthcare professionals when you cannot express your wishes.
What Happens If You Do Not Have an Estate Plan?
Failing to create an estate plan risks creating serious challenges for your loved ones. Without a plan, your property passes through the “intestate succession” process, which allows for little control and risks conflict and delay.
Intestate Succession
Intestate succession is a process where the law selects your legal heirs. The process involves identifying your family members who are still alive. Assets then pass to your closest surviving family members, typically passing first to your:
- Spouse,
- Children,
- Parents and siblings,
- Aunts and uncles, and
- Grandparents and cousins.
This process occurs regardless of what you may have wanted, preventing you from providing for anyone not legally related to you.
Consequences of Lacking an Estate Plan
Not having an estate plan may lead to:
- A lengthy probate process, which may create financial strain for your heirs;
- Family disputes, which may erode relationships and consume significant time and money; and
- Extra fees and taxes resulting in unnecessary costs for your loved ones.
Additionally, if you have minor children and fail to designate a guardian to care for them if you die, the courts may decide who takes responsibility for their care, potentially contrary to your wishes.
When to Start Estate Planning
Estate planning is essential for everyone, but when to start estate planning depends on your circumstances. At a minimum, consider starting when you experience major life changes or acquire significant assets, such as:
- Getting married,
- Having children,
- Purchasing a home or
- Starting a business.
Starting earlier allows you to benefit more from the estate planning process.
Benefits of Early Planning
Early estate planning provides benefits like:
- Protecting your loved ones from unexpected events, such as accidents or illnesses, that can occur at any age;
- Controlling what happens to your assets;
- Enabling you to protect your assets while qualifying for Medicaid long-term care benefits;
- Minimizing gift and estate taxes;
- Simplifying the revision and update processes; and
- Creating a record of changes you make to your plan.
Early planning also allows for opportunities to explore more complicated estate planning tools, like charitable giving strategies or establishing a family foundation.
Consequences of Starting Early
The primary consequence of starting estate planning earlier is that you may need to adjust the plan multiple times. Modifying your plan may involve updating your:
- Will,
- Trusts, and
- Beneficiary designations.
When events happen, your estate plan may no longer account for your life as it is. You may need to adjust your plan if you:
- Get married, separated, or divorced;
- Have a child through birth or adoption;
- Acquire significant property or start a business;
- Move to a different state; or
- Experience significant changes to your health or your loved ones’ health.
By default, your spouse is generally entitled to some portion of your property, so you should update your estate plan whenever your marital status changes.
When Should You Get an Estate Plan?
In summary, when should you get an estate plan? At what age should you start estate planning?
There is no perfect age to start planning, but you should reach out to learn more if you:
- Have one or more children,
- Get married or divorced,
- Obtain significant property interests,
- Start a business, or
- Want to leave property to anyone or anything other than your family.
Ultimately, the more property you accumulate over time, the more essential an estate plan becomes.
Call (512) 410-0343 or complete the free case evaluation form below
Contact our Estate Planning Attorneys in Austin
Estate planning earlier in life usually benefits you and your loved ones. At Massingill, our estate planning attorneys in Austin can help you create a unique plan tailored to your life, loved ones, and goals. Contact Massingill today to schedule a consultation. Let our team guide you and provide peace of mind, knowing your affairs are in order.
Joshua Massingill
Joshua Massingill is an attorney practicing in Austin, Texas. He serves on the Texas State Bar’s Law Practice Management Committee, the Leander Educational Excellence Foundation (LEEF) Board of Directors, and the Success-Werx Board of Advisors. He mentors young entrepreneurs in Leander ISD’s INCubatorEDU program and is active in his church.
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