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Estate planning is more than legal paperwork. It’s about making sure your wishes are honored, your loved ones are protected, and your legacy is preserved. But misinformation is everywhere. Let's uncover the truth behind the most persistent estate planning myths.
Myth #1: "Estate Planning Is Only for the Wealthy"
This myth is the most damaging. Estate planning isn’t about how much you have. It’s about what happens to what you do have.
Why It’s Wrong:
Even with just a modest home or a small savings account, it's crucial to have a direction for your estate. Lacking a plan, your could get entangled in a lengthy probate process. If you have minor children, creating an estate plan is an important step that can help ensure your wishes are known.
Myth #2: "A Will Is All I Need"
A will is important and a great start but it's just a part of the bigger estate planning picture.
Why It’s Wrong:
Wills do not address healthcare decisions or establish financial powers of attorney. A will cannot avoid probate specific assets. It also fails to protect digital assets, joint accounts, or property held in trusts. In addition to a will, you may need a living will, healthcare guidelines, power of attorney, asset titling review, and trusts.
Myth #3: "I’m Too Young for Estate Planning"
Don't think of estate planning as something tied to age. Instead, it’s all about those big life moments and changes.
Consider these situations:
- Do you have kids needing a guardian if something happened to you?
- Do you own a house or have any savings, even if they're modest?
- Have you considered what might happen if you're unable to make your own decisions in the future?
Even young adults in their 20s and 30s can benefit greatly from having an estate plan. It allows you to appoint guardians for your children, establish clear healthcare instructions, and manage your digital assets effectively.
Myth #4: "Estate Planning Is a One-and-Done Task"
As life changes, it's important to keep your plan up to date to match your current circumstances.
Why It’s Wrong
Life events can happen at any moment. Creating an estate plan when you're single is great start, but if you don't update it after getting married, your family might face some challenges in sorting out your assets in case of an unexpected passing.
Other life events that might pop up include welcoming a new family member, going through a loss, experiencing financial changes, or general updates in estate tax laws.
Myth #5: "My Family Will Know What to Do"
Without proper guidance, even the closest families might face confusion, disagreements, or legal obstacles.
Common Oversights
Consider this: does your family know every detail about your assets? Have you chatted about everything thoroughly? If you have, that's fantastic! However, it's still easy for some things to slip through the cracks or be overlooked. Some oversights could include lack of access to digital assets or accounts, unclear healthcare decisions, and disputes over family heirlooms.
Myth #6: "I Don't Need an Estate Planning Attorney"
Online will services can be quite appealing with their simplicity. However, their one-size-fits-all might not fully address the nuances of your family situation or your specific asset protection needs.
Why an Attorney Matters
Working with an attorney can help guide you through the complexities of blended families, second marriages, and special planning. They customize documents to comply with state-specific estate laws and help prevent the mishandling of probate assets.
Myth #7: "Estate Planning Is Only About Death"
Not true. Actually, it’s also about planning for situations where you might be alive but unable to make decisions for yourself.
Key Areas
While a lot of estate planning focuses on how your assets will be distributed after you’re gone, it’s also about preparing for the unexpected while you’re still around. Consider including these important documents in your plan: a healthcare power of attorney, a financial power of attorney, and a living will with healthcare directives. Without these, important decisions might end up in the hands of the courts instead of your loved ones.
Myth #8: "Trusts Are Only for the Rich"
Trusts are adaptable tools that can fulfill various purposes, extending well beyond just preserving wealth.
Benefits of a Trust
A trust is a great tool for individuals of varying financial backgrounds, providing significant benefits that are often overlooked. Trusts are beneficial because they help you skip the hassle of probate, take control of how your assets are shared over time, and help protect what to leave behind for young children or loved ones with special needs.
Myth #9: "Estate Taxes Will Eat Up My Estate"
This is a widespread fear, but it doesn’t reflect the reality for the vast majority of households.
The Facts
In 2025, the federal estate tax exemption stands at $13.99 million per individual, meaning that estates valued below that threshold are not subject to federal estate tax.1 For married couples, that exemption can be effectively doubled with proper planning.
As a result, fewer than 0.1% of estates actually owe federal estate taxes. However, it’s still important to be aware of state estate or inheritance taxes, which may kick in at much lower thresholds depending on your location.
Myth #10: "Probate Isn’t a Big Deal"
Probate is public, time-consuming, and costly and can drag on for months or even years. In some states, the fees associated with probate can significantly decrease the value of the estate left behind.
Challenges & Way to Minimize
The probate process can bring about a few hurdles, like delays in getting assets to your loved ones, added court and legal costs, and having your details become public. To minimize probate, use beneficiary designations on retirement accounts and life insurance, set up transfer-on-death (TOD) and payable-on-death (POD) accounts, and utilize trusts for key assets.
Final Thoughts
Estate planning myths are common, but you don’t have to fall for them. From managing accounts and healthcare decisions to how your assets are distributed, a well-crafted estate plan can help provide clarity. Keep your documents up-to-date, and make sure to share your plans with your loved ones clearly. Your future self will thank you!
Don't fall for common estate planning myths. Start Your Free Plan
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