Estate Planning in Illinois? Why Bother?
A lot of people ask why they should bother with an estate plan when they aren't rich and don't have to worry about estate taxes. It's a good question, and there are a few answers that depend on what you want to accomplish.
Why a Will is a Good Choice
A Will is a flexible way to make sure that your post-death wishes are honored. It can be as simple or as complex as you want. You may want certain people in your family to get more of your estate, or you may have certain conditions you want to put into place. It's flexible, easy to change, and frankly not that expensive. The downside with a will is that it doesn't avoid probate, but we will get into that later.
All things considered, outside of controlling where your assets go, there are two HUGE reasons that you should probably have a will.
- If you die without a will, your estate representative will need to post a bond. This can be quite expensive depending on the size of the estate, slows down the process, and diminishes the amount of money that will actually be left behind to your heirs. The thing is, a will lets you waive the bond requirement that is otherwise set in stone for people who die without a will. You save your estate money my having a Will. It's just common sense.
- If you have kids, a will gives you a place to set out exactly who you want to care for them I the unfortunate event that something happens to you. I talked about this before in another blog post. If you pass away, the last thing you want is relatives fighting over who is going to take care of your kids. Your kids have enough to deal with. The easiest way to prevent squabbles over guardianship and money is to lay out your wishes in a well-crafted will.
A Will Isn't Your Only Choice
You don't need to put all of your eggs in one basket. If you want to avoid probate almost entirely, a revocable living trust might be a good vehicle for you. Like a will, a revocable living trust can be as simple or as complicated as you want to make it. Instead of your assets being disbursed on your death, a trust lets you transfer things into the trust. Once you die, the assets in the trust transfer according to the terms of the trust. If you use a revocable living trust, payable on death designations (more on this later), and a pour-over will (a simple will that puts everything left into the trust), you can avoid probate almost entirely. It makes things much easier on your heirs and isn't that much more expensive than a will. The best part? Privacy. A filed will is a public record that literally anyone can go look at. Trusts are private. If you value your privacy after death, a revocable living trust is a very good option.
As always, give me a call if you have any questions about estate planning. It's kinda what I do.