You may not be surprised to hear that a lot of Americans do not have an estate plan. Despite the importance of an estate plan to the future of you and your family, you may not think that you need one.
According to U.S. News, there are some myths that you should avoid believing.
Estate plans are static
Some people avoid estate planning because they believe that their decisions can never change. Realistically, your life will continue to change, and you will have to alter your estate plan to reflect those changes. If you have more children, add grandchildren or have any other life changes, you may need to make changes to your estate plan. You may need to name a new executor or trustee if the one you originally selected can no longer perform the job. You may have to add a different person as a beneficiary to your life insurance policy or retirement account. You may have a brand-new financial situation after winning the lottery or receiving an inheritance. Creating or revising your estate plan is the first step.
Estate plans only involve assets
When you think about wills or trusts, you probably think about finances and assets after you pass away. While this is a major part of estate planning, there is more to it. You also want to think about your health. For example, you may want to have a financial power of attorney or a living will in case you become incapacitated. If you can no longer make financial or healthcare decisions for yourself, do you have a plan in place or do you want to leave these decisions up to someone else? Who do you want to make the decisions for you? A power of attorney can designate someone to manage your finances and make decisions about your healthcare.
You should not wait to create an estate plan, since we never know what the future holds. If you only recently entered the workforce, just got married, have young children or recently lost a loved one, a first or revised estate plan can help reduce stress if something happens to you.