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Five Types of Estate Plans

Oct 25, 2018 | Estate Planning

Five Types of Estate Plans

FAST FACTS

  • 6 in 10 U.S. adults, on average, don’t have a will.
  • 81% of people 72 and over have an estate plan.
  • 64% of Gen Xers don’t have a will.

 

It’s not exactly shocking to discover that the majority of people in the country don’t have a plan in place for their assets upon their passing, but it’s disheartening. People don’t like to think about their death and planning for how their money, real estate and other holdings will be disbursed after their demise since it can seem frightening and stressful.

As Atlanta estate planning attorneys, we know that the turmoil a family can experience if there is no plan in place is often more stressful. We also know that with online products that allow people to create these documents themselves aren’t always what they are cut out to be. Estate planning is a complex process that is best undertaken with the assistance of an expert.

In essence, one of the worst mistakes people make when attempting to create an estate plan on their own is choosing a product that is wrong for them or doesn’t completely meet their needs. Here are the five general types of plans you have to choose from.

1. Spend It All

This isn’t as much of a plan as it is a way of life. People who utilize this strategy are the type that think “you can’t take it with you.” Maybe they don’t have children. Perhaps there is no family to leave anything to. The basis of this plan is to spend every last dollar. If we are being realistic, no one ever does this. People are afraid of running out of money and rightly so.

It certainly sounds like an excellent way to leave this world — having fun right up until the last minute and spending everything you have without thought. Fun isn’t reality though, and it would take an incredibly intricate plan to be able to spend your very last dollar on your very last day.

2. Dying Intestate

Think of this one as a “term” rather than a “plan.” Dying intestate means that you pass away and have no plan in place at all. Here’s what you need to know: If you didn’t take the time to create an estate plan, Georgia is more than happy to create one for you.

There is very little doubt that you don’t want the government to decide how your assets will be divided and who will be responsible for paying what taxes.

3. Simple Will

A simple will is common among married persons. It’s fairly basic and easy to create. Everything that belongs to you is passed on to your spouse when you die.

When your spouse passes away, everything is passed onto the children, if you have any.

4. Revocable Living Trust

In most cases, a revocable living trust is set up in a similar way to a simple will. You leave everything to your spouse and then to your children. People often choose revocable living trusts because they believe probate will be avoided.

Like any plan, there are drawbacks to a revocable living trust — aside from not necessarily avoiding probate. Let’s look at an example:

You have adult children who don’t get along. They’ve not spoken to one another in years due to bitter animosity. You leave half of your estate to one and half to the other. They both believe they deserve more. Your children will have longer to contest the trust than they would have had to contest a simple will. While this certainly won’t happen in every case, it is something to consider.

5. Comprehensive Estate Plan

Your estate consists of more than what is in your bank account. It includes all of the property you own upon your death: real estate, stocks, securities, bank accounts, insurance policies, and personal property. Some people believe that they won’t need to worry about what will happen to all of these things while they are young, but we never know what life will throw at us. It’s never too early, or too late, to speak with an estate planning lawyer about creating a plan.

Here is what a comprehensive estate plan can do for you:

  • Determine which family members you wish to name as beneficiaries.
  • Ensure that your property is transferred as soon as possible to those people upon your death.
  • Reduce the amount of taxes your beneficiaries are required to pay or will be paid out of your estate before it is divided.
  • Avoid probate by putting certain planning devices into place.
  • Determine what you would like to happen at the end of your life.
  • Pay for funeral and burial expenses.

Our Atlanta Estate Planning Attorneys are Here for You

Not every person who sits down with an estate planning professional will need all available components included in their comprehensive plan. You may need more or less than another person depending on the unique situation your family is in and the amount and type of property you own.

If you are ready to discuss your current desires for your property upon your passing, reach out to our Atlanta estate planning attorneys. We are here to sit down with you and explain the products that will benefit you and those you can do without. Let us help you create a comprehensive estate plan that meets your future needs. Call our office today to schedule your consultation.

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