Most of us tend to think that estate planning is only for the elderly or for those with substantial assets. Actually, estate planning is critical for everyone regardless of age or income. The purpose of an estate plan is to save your family needless stress, anxiety, and expense in settling your affairs. A well thought out estate plan also gives you peace of mind, knowing that you will not leave a burden for your family to deal with. What do people need to think about at different stages of their lives? Here are the stories of some clients at different stages of life (names have been changed).
For young adults, just starting out, with few assets, estate planning can be straightforward. Hannah is 25 years old, just out of college, single, and getting established in her first job. Even though she is very healthy she needs to have someone designated to make health care and/or financial decisions for her in the event she has an accident or illness that leaves her incapacitated. Imagine that you are unable to manage your day-to-day finances or voice your preferences for health care. Who can step in to make decisions for you? Who can access your funds to be sure your bills continue to be paid while you are recovering?
Hannah's parents would be the ones appointed by a Court if they were still alive and something happened. But that process, if there are no documents in place, can take months even in the best of times. This becomes even more complicated (and litigated) if her parents are divorced or have other special circumstances.
Hannah is renting an apartment and has a car that she still owes money on. She decided to take out the life insurance offered through her employer with her parents and sister as beneficiaries. Hannah also put a family member as co-owner on her car title documents and as a second signature on her bank accounts. She had us prepare a basic will, financial power of attorney, and health care power of attorney. Finally, Hannah made a list of where all her assets are and made her sister beneficiary for her 401k retirement account through her employer. For Hannah, as for most young people, estate planning was relatively easy.
Starting a Family
When you start a family, things get complicated in more ways than one. James and Danielle are feeling that there is little time to think straight between work, home, and 2 AM feedings, but there are some critical legal matters for young families. If one or both parents are in an accident, there should be a clear designation regarding who will be any minor childrens' guardian. There should also be someone who can make healthcare and financial decisions for the parents and access funds to be sure bills are paid and the children’s needs are taken care of.
By this stage of life, most people have more assets such as cars, a house, etc. South Carolina law has very specific provisions concerning who inherits property and other assets in the event one parent or both parents’ die without a will. If one parent passes unexpectedly without a will, half of their assets go to their spouse while the other half would go to their children. This can be especially troublesome if some or all or those children are minors because the probate court would generally need to appoint a conservator to help manage those assets and the surviving parents would have to annually account for those assets.
You may not want your assets to be handled this way. Making an estate plan is critical in protecting your assets for your children and making sure your spouse isn't having to also deal with these financial and legal issues while grieving. James and Danielle had a particular concern about one family member handling money on behalf of their children, because this person was a terrible money manager. They were relieved to learn that they could designate one family member as guardian for their young sons but another person to manage their assets to be used for their sons' needs. We were able to prepare a simple revocable living trust, wills, financial powers of attorney, and health care powers of attorney for James and Danielle. This plan ensured everything would pass to the surviving spouse first and would be managed properly if something happened to both of them, all while avoiding probate. Our attorneys enjoyed getting to know this young couple and helping them feel confident that even if the worst happened, their boys were protected and provided for.
As we age our needs will change. When you reach retirement age, you may be considering leaving assets to your children or grandchildren. Steven and Karen were healthy, active 70-year-olds when they made an estate plan. They had worked hard and accumulated significant assets. We were able to help them craft an estate plan that helped them preserve their independence and plan for how the remainder of their assets would be distributed to their children and grandchildren with no probate hassle. Steven and Karen set up a trust. They also created new wills, financial and health care powers of attorney. As part of their planning, we discussed long term care costs such as assisted living and nursing home care and made sure they had a plan for how to pay those without going broke. Steven and Karen have the peace of mind of knowing that they have provided for their assets to go to their children and grandchildren with minimal hassle and expense after they pass away.
Call us Today
No matter what stage of life you are in, our South Carolina Attorneys can help you. Call us today at (803) 358-7214 or complete the contact form to set up a time to discuss your family’s unique situation and needs with our attorneys.