About Wills
Did you know that the majority of Americans do not have a will? It’s true! The number of US households with a will has been steadily declining. But estate planning isn’t just for the wealthy, older adults, or married couples; it’s beneficial for everyone. Let’s bust some common myths about wills and estate plans:
Myth #1: Wills can be used to avoid probate.
I like to say that a will is a “Dear Judge Letter!” Many people believe that having a will allows them to avoid probate. However, even if you have a will, your estate may very likely go through probate if any asset does not have a joint owner or beneficiary designation. Probate is costly and delays distributions to your loved ones but is necessary to ensure that your estate is administered accurately and legally. To avoid probate, consider using a trust-based estate plan, which may very well avoid probate. As the saying goes, “An ounce of prevention is worth a pound of cure.”
Myth #2: You cannot use a will for tax planning.
The certainty of death and taxes, as famously noted by Benjamin Franklin, is not quite as certain as the taxes you might owe at the time of your death. Estate taxes, sometimes called death taxes, are applied to assets (your money and property) that you leave to others when you pass on, but the threshold net worth value when these taxes kick in is very high. If you pass In 2024, you will not owe federal estate and lifetime gift taxes until your taxable estate is over $13.61 million, per person. However, the federal estate tax exemption amount is set to decrease sharply at the start of 2026 and revert to pre-2017 levels that are around half of what they are now. This anticipated decrease in the exemption amount might justify employing advanced estate planning strategies now, ahead of the 2026 sunset. Remember, “A penny saved is a penny earned.”
Myth #3: Creating a will is cheaper than creating a trust.
Creating a basic will might be cheaper than creating a basic trust, but it is not an apples-to apples comparison. Trusts tend to be more complex and therefore more expensive to prepare. However, both wills and trusts can contain similar provisions that require a comparable amount of time to draft properly. Consider the costs of not having an estate plan or having a plan that falls short of your goals. Probate Administration can be costly, and your family will have to bear these expenses later.
Estate planning is not an area where it pays to cut corners. As the old adage goes, “You get what you pay for.”
And Beware: A will does not determine who will make financial and medical decisions for you if you are alive but unable to make them yourself due to illness, injury, or age-related decline. As our population continues to age, many folks will leave their autonomy subject to the decisions of the state or county without proper estate planning.
To discuss your estate planning goals and how we can help you meet them, please reach out and schedule a consultation. Let’s ensure your legacy is protected and your loved ones are taken care of.
