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Building wealth is only half the job. Protecting wealth for your loved ones and yourself is equally important. Through estate planning, business planning, and asset protection, the Nance Law Firm will help you protect everything you love — family, friends and favorite charities. For more information be sure to visit our web site where you will have access to our blog, events schedule and a complimentary newsletter subscription!
Estate Planning for Women
Women account for more than half of the U.S. population. Not surprisingly, women have a major impact on the lives of others in the myriad roles they fill. Whether as daughters, sisters, wives, mothers, friends, or in professional roles, women tend to put the needs of others before their own. While this selflessness is itself praiseworthy (and too often underappreciated), women cannot neglect their own needs. For example, estate planning must be a priority for every adult woman.
However, women are not alone in this. Many Americans fail to make proper estate plans, often due to common misconceptions about estate planning. Unfortunately, these false impressions can leave women especially vulnerable. What are some of these mistaken beliefs?
- Your surviving spouse and children will automatically receive your assets when you die.
Nothing could be further from the truth. Only by carefully coordinating the title and beneficiary designations of your assets with estate planning documents appropriate for your unique circumstances, can you ensure to whom and how the assets will transfer. When you die owning assets titled solely in your name or without a living beneficiary designated, such assets fall under the control of probate. When assets become “probate” assets, only a valid last will and testament can direct to whom and how they will transfer. Dying intestate is the legal term for dying without a last will. When that happens the laws of intestate succession in your state statutes determine who inherits your estate, not you. For example, your home could pass one-half to your spouse and one-half to your children, instead of fully to your spouse as intended. If you are single, then one-half of your estate would pass equally to the sister you adore and the brother from whom you are estranged. In short, dying intestate is always more expensive and burdensome on loved ones, than dying with a comprehensive estate plan.
- Only the wealthy need a power of attorney.
A general durable power of attorney is essential incapacity planning for women, regardless of socioeconomic status. With it, you can appoint a trusted individual with the legal authority to manage your finances, in the event an accident or illness leaves you legally incapacitated. For example, what if you are in a coma following an auto accident? Would your spouse have legal authority to manage your personally owned investment account or at least sign your name to a joint tax return? No. Even spouses cannot handle routine financial matters for one another absent proper, written legal authority. That alternative? A process that can best be described as the lawyer full-employment program in probate. The process employs at least three attorneys, and will invade your wallet, your calendar and your privacy. At the end of the probate process, a judge who likely does not know you and your family, will appoint a financial conservator of his choosing for you. That financial conservator could be your estranged brother, not your loving sister.
- Estate planning can wait until you are old.
Although contemplating your own mortality is not pleasant, it is necessary. We may not know how or when we will die, but we do know we will leave behind a catastrophic estate mess for our loved ones without proper legal plans in place. As the saying goes, “The old must die and the young may die.” Consequently, even women who have recently turned age 18, should have a basic estate plan in place. If you are a single mother or married with young children, you need to nominate a legal guardian to raise your children, if they become orphans. If you die intestate, then a judge must select a guardian for your minor children or they will become wards of the state. They may grow up being raised with the values of your estranged brother as guardian, instead of by your loving sister who adores them.
- Healthy individuals do not need medical directives.
People are hospitalized for more than chronic illnesses, as we have seen with the COVID-19 virus. Many individuals do not know they have heart issues, until they are experiencing a heart attack. Strokes strike with little warning. Even accidents can have devastating consequences. In an instant, your perfect health can be gone. Decisions regarding treatment and lifesaving measures must be made. With an advance health care directive, you can designate someone you trust to make these choices on your behalf and also outline the type of care you would prefer to receive.
- Prenuptial agreements are unnecessary.
In the past, women wed younger and brought few assets into a marriage. With more women attending college and starting their careers before marrying, women have more to lose in the event of a divorce. Although a prenuptial agreement is not a romantic concept, creating one is a wise choice in an era where divorce is common. If you are getting remarried, a prenuptial agreement protects not just you but also the future inheritance of your children from your previous marriage. Both you and your new spouse can legally agree to leave assets brought into the marriage to your own respective children.
The estate planning misconceptions in this brief article are only a few of many. Do not ignore this personal responsibility to protect others – and yourself – from the consequences of becoming incapacitated or dying without proper estate planning. There are resources on our website to help you learn more.
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