Everyone benefits from having an estate plan. It gives you relief as you think about distributing your assets and provides guidance for your heirs. But setting up documents regarding your finances and health can seem daunting.
However, many things that make estate planning confusing are myths or misconceptions. There are so many popular ideas about estate planning that are actually false. Here are some common misunderstandings about estate plans to stop believing.
Myth #1: A will handles all my assets
While it is true that you should create and sign a last will and testament, it does not cover all your estate planning needs. You may use a will to lay out your wishes regarding your belongings, such as vehicles and family heirlooms. But many assets pass to beneficiaries outside of your will. A will does not have controlling power over accounts with beneficiary designations, such as retirement accounts.
Myth #2: I can wait until I am older
You may procrastinate your estate plan because it causes some discomfort. There is also a common belief that estate planning is only for people in their 70s or 80s. But you can start your plan whenever you want – and you should. Having a plan in place now will give everyone peace of mind. Plus, you can always update your plan, bringing the topic to the next myth.
Myth #3: Once I create an estate plan, I do not need to or cannot change it
Estate planning is best when it is a continuous process. You do not simply sign a document and put it away for decades. It is a good idea to review your documents periodically, especially when major changes take place in your life or family. Additionally, your desires may simply change over time.
Once you have a clearer picture of estate planning, you will realize that it is not so intimidating or complex.