Sometimes estate planning takes place in plain sight. Take, for example, Jay-Z’s song, “Legacy.”
In it, he details an estate plan for his daughter, Blue Ivy: “My stake in Roc Nation should go to you / Leave a piece for your siblings to give to their children too / TIDAL, the champagne, D’USSÉ . . .”
Yes, it’s a rap—an excellent one—but he makes some important estate planning points: identifying how he’d like his business assets distributed and that he wants her to share assets with her siblings and their beneficiaries. As a wildly successful mogul, he’s got to cover his bases.
Let’s be honest, though: You don’t have to be a mogul to make estate planning valuable for you and your family.
Why is estate planning so important?
Estate planning is so much more than wills and trusts laying out your final wishes for how your property and assets get distributed. There are also many other long-term benefits for you and your loved ones to consider.
Seven reasons why you should work with an estate planning attorney in Texas
Here are seven reasons why you need an estate plan:
1. An estate plan allows you to determine how assets will be distributed
What happens if you pass away without a valid will or trust in Texas? State laws might end up determining who gets your property.
Under the Texas Estates Code, your family situation at the time of your death could determine who gets what—that is, unless you have a will that clearly expresses your intent.
2. An estate plan can help protect beneficiaries
You want to continue supporting family members even after you pass on, which makes estate planning essential. Estate planning lets you designate which financial assets you want to leave behind for children, family members, and others and how you’d like them to receive these assets.
This is particularly important when you have minor children or loved ones with special needs as a beneficiary. You don’t want minor children not to have access to funds, but neither do you want them buying a Lamborgini when they turn 18 and receive said assets.
And when designating a loved one with special needs as a beneficiary, you need to consider the full picture of their needs. If they rely on income-specific government programs, not thoroughly planning out your estate could potentially jeopardize their eligibility.
Estate planning doesn’t just impact where your assets go, either—without a valid will, a judge has the legal authority to decide who could act as guardians for your minor children or loved ones with special needs.
3. Certain estate plans protect assets
If you don’t have the correct legal documents in place and you pass away or become incapacitated unexpectedly, your assets are at stake.
And since you’ve spent your entire life working hard for everything you own, it only makes sense to protect your property and loved ones’ best interests. This means preventing creditors from making a claim against your estate to settle your debts. Estate planning can prevent the IRS from taking a large chunk of your assets, as well.
With a trust, financial powers of attorney, and a healthcare proxy, you can add an extra layer of security against this happening. This is especially important for retirement planning.
4. An estate plan can reduce estate-related taxes
When leaving property and other assets to your family, consider the financial implications of your passing. An estate planning attorney can help you minimize the taxes your family may be liable for when receiving their inheritance—and in some cases, it’s possible to eliminate this burden. Without a plan in place, however, you risk exposing your beneficiaries to financial hardship.
5. An estate plan avoids probate
The Texas probate process can be time-consuming, costly, and stressful for your surviving loved ones. A will can help make the probate process easier, but a detailed estate plan can take probate into consideration and circumvent much of the stress. Depending on your situation, potential strategies may include:
- Ensuring all possible assets are owned jointly
- Designating certain assets as transfer on death and/or pay on death
- Transferring your assets into a revocable trust
6. An estate plan can help with philanthropy
An estate plan does more than express which relatives should receive your property or assets—it can also support your philanthropic efforts.
You don’t have to fund a hospital wing to be a philanthropist. It can be as simple as regularly planned donations to organizations you care about and with estate planning, you can continue to do so long into the future. However, your charitable giving may come with certain tax implications, so consult with a knowledgeable Texas estate planning attorney when designating a charity as a beneficiary.
7. An estate plan avoids messes
Without a will or trust, it can be stressful for your loved ones to know what your last wishes are for your assets and remaining property. An estate plan can ensure your directives are transparent and straightforward, reducing the stress for all of your beneficiaries.
Ready to make an estate plan? Contact our Texas estate planning law firm
At the Law Firm of Shann M. Chaudhry Esq., Attorney at Law PLLC, we help individuals, businesses, and married couples in Texas plan for the future and protect the best interests of their estates. Our skilled estate planning attorneys can guide you through the process so you can leave the legacy you intend for your beneficiaries.
Ready to get started? Contact our team today.