There is misconception, and then there is reality.
Lots of people mix those up when it comes to estate planning.
And, actually, that’s not so surprising. Like much in the legal realm, the bread-and-butter elements at the core of estate administration – asset protection and distribution, lawful tax avoidance, various powers of attorney, wills/trusts and other key documents and so forth – entail both complexity and even state-by-state variance. Many individuals and families procrastinate on planning because they find it intimidating, onerous in its details or even seemingly irrelevant to their station in life at a certain time.
For those and other reasons, estate administration has become a realm of misconception for many would-be planners in Arkansas and across the country. A recent article on planning refers to its many “common myths,” as well as “the realities behind them.”
One cited example comes courtesy of the will, which is the cornerstone document in the estate administration universe. Some people – likely most individuals – reasonably enough believe that a will absolutely controls legally where it states a drafter’s intent concerning asset distribution.
That is not correct, though. If a creator has insurance, investment and/or other money-linked accounts with named payable-upon-death beneficiaries, the documents that established those accounts — not a will, especially one with a contrary designation — will determine who is entitled to the proceeds.
Another misconception is common among younger people, especially individuals who are relatively recently married and just starting families. Many people in that demographic believe that they can put off planning for years and that it is primarily a chore that commands relevance for older people.
That, too, is a myth. What happens to children without named guardians in the event something tragic and untimely happens to their parents? A will can adequately address that possibility. It can also designate trusted individuals via powers of attorney who can step in if incapacity occurs to make important financial and medical decisions for a planning individual or couple.
The central reality underlying estate planning is that it broadly applies far earlier and to a wider audience than is commonly perceived.
Questions or concerns regarding estate administration can be addressed to an experienced planning attorney.