Don’t Have $5 Million? 50 Reasons to Get an Estate Plan Anyway

June 7, 2011
300px Happy family5 Don’t Have $5 Million? 50 Reasons to Get an Estate Plan Anyway

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“Estate Planning” is somewhat of a misnomer.  For example, let’s check out The Free Dictionary’s definition of “estate”. You’ll find that the majority of the 8 provided definitions associate the term either with land or with some kind wealth, social position, or political power.

So when many hear the term “estate planning”, they naturally imagine giant mansions on rolling hills with exquisite landscaping and gardens, mile-long driveways and exclusivity, and immediately think “nah, this isn’t for me”.  This thought process goes even further because of current law (for 2011 and 2012, anyway) indicating that the first $5 million of every person’s estate is exempt from estate taxes.

However, in our context, “estate” should instead be viewed what is described in definition #2: “The whole of one’s possessions, especially all the property and debts left by one at death.”  Despite our imaginations, all adults need an estate plan whether rich or poor, tall or short, fat or thin, or whatever other clever dichotomies one can think of.

So let’s list no less than 50 reasons why an estate plan would be necessary, even if you don’t have anywhere near $5 million.  By the way, consider that any single one of these reasons is a good enough one to implement your plan.

Philosophical Reasons

  • You want complete control – you don’t want state law to determine where your assets go after your death.
  • You want privacy regarding your estate affairs.
  • You are too uncomfortable to discuss estate planning issues with your family but obviously need to do something.

Cost Savings

  • You do not want your family to pay extra administrative fees after your death.
  • You do not want your family to pay extra fees to have a guardian and/or conservator appointed for an incapacitated relative.
  • You own real estate in another state or country and want to avoid extra probate costs.

Planning for Your Incapacity

  • You desire to replace your income during your incapacity.
  • You need someone to make financial decisions for you if you become incapacitated.
  • You need someone to make medical decisions for you if you become incapacitated.
  • You would like a family member or close friend to have access to your medical records.
  • You would like to leave instructions for medical personnel to “pull the plug” if your health condition ever becomes terminal.

Planning for Your Surviving Spouse or Significant Other

  • You have a non-citizen spouse.
  • You want to protect your family’s assets from creditors.
  • You want to protect your family’s assets from being wasted.
  • You want to protect your assets for your same-sex partner.
  • You want to protect your assets for an unmarried partner.
  • You are concerned that your surviving spouse’s next marriage could result in the disinheritance of your children.

Planning for Your Children

  • Your children are too young to receive your assets.
  • You wish to name guardians for your minor children in case of your death.
  • You want to protect your children’s assets from a divorcing spouse.
  • You want to set up incentives requiring your child to achieve some benchmark before inheriting anything.
  • You need someone to manage your children’s share of your assets after your death.

Financial Planning Reasons

  • You wish to coordinate your life insurance and retirement assets with the rest of your estate.
  • You want to ensure that your children’s college expenses are covered.
  • You wish to indicate which assets should be used to pay off your debts.
  • You want to ensure that your mortgage is paid off at your death.

Advanced Tax Planning Concerns

  • You own a stock or business interest that has had a significant appreciation in value.
  • You wish to somehow leave some assets to charity.
  • The estate tax exemption of $5 million is temporary, and is currently set to drop to $1 million by 2013.
  • You want to implement or continue a gifting plan upon your incapacity or death.
  • You want your grandchildren, and not your children, to get your assets.
  • You wish to prevent your children from pulling all assets from IRA account too quickly.
  • You want to reduce or eliminate state estate taxes.
  • Your retirement account contains a high dollar amount.

Business Planning Concerns

  • You fear your family will lose control of the business.
  • You fear your family will only get pennies on the dollar for your business after your death.
  • Not all of your children want an interest in the business.
  • Another type of entity could better benefit your heirs.
  • You anticipate your family will not have enough cash to cover taxes and expenses after your death.
  • You don’t know the value of your business.

Special Concerns

  • You are involved in an assisted reproduction situation.
  • You have a blended family and need to decide if your new spouse or children from your prior marriage should get priority.
  • You wish to disinherit a child or treat your children unequally.
  • You have become separated or are recently divorced.
  • Your family situation has much complexity and strife.
  • You wish to funding for another person’s long-term care or other needs.
  • You wish to provide for your pets after you are gone.
  • A family member has special needs.
  • You want to disinherit your spouse.
  • You are in poor health or the need for planning is imminent.
 Don’t Have $5 Million? 50 Reasons to Get an Estate Plan Anyway
 Don’t Have $5 Million? 50 Reasons to Get an Estate Plan Anyway


Scott R. Zucker, Esq. is the owner of The Zucker Law Firm PLLC, located just outside the Capital Beltway in Annandale, within five miles of the City of Fairfax, the county seat of beautiful Fairfax County, Virginia. The firm focuses mainly on estate planning services for Virginia, Maryland and Pennsylvania clientele, and seeks to do so in an affordable and approachable way. People interested in learning more can contact Scott by phone or email.

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