5 Reasons Why You Should Consider an Estate Plan for the New Year

With the New Year fast approaching, most of us are in a reflective mood. What did we accomplish in 2023? And what can we do better in 2024?

For a lot of people, the answer to the last question is: create an estate plan. The sudden and violent appearance of the pandemic has taught us that you can never be sure what the future holds, but that doesn’t mean you can’t plan for it.

According to a recent survey by Caring.com, the pandemic has inspired a 50% increase in the number of 18 to 34-year olds with an estate plan, and those who survived a serious case of COVID-19 are 66% more likely to draw up a will than those who did not. If you have yet to put one together, here are 5 reasons why you should consider an estate plan for the New Year.

1. Your Family Will Thank You for Looking Ahead

Estate planning conversations are not always comfortable. When you’re baking Christmas shortbreads, wrapping gifts, and decorating the tree, the last thing you feel like talking about is end-of-life planning and who should take care of the kids if something happens to you.

However, family get-togethers represent an opportune time because you can have face-to-face conversations, address their questions and concerns, and rest assured that they understand and support your wishes.

Perhaps the best way to understand the importance of an estate plan is to consider the alternative. For example:.

• If you pass away without a will, your property will be distributed according to your local laws of intestate succession. In most cases, this means that your spouse gets a certain percentage and the rest is divided among your children. If you’re unmarried, the outcome will vary depending on who your heirs are, and it may not be what you want.
• If you have children and something happens to you and their other parent while they are still minors, a court will have to decide who will raise them, and the appointed guardian may not be someone you would have chosen.
• Should you be critically injured in an accident or lose capacity to make your own healthcare decisions, your family is left wondering what your treatment wishes are.

By putting together an estate plan that includes a will and provisions for a healthcare proxy or power of attorney, you can spare your loved ones the stress of an unwanted outcome.

2. You’ve Got Some Time to Talk About Estate Planning

The holidays can be pretty hectic, but you’re mainly busy with family-oriented responsibilities. As you indulge in a flurry of baking, decorating, and shopping, you have an opportune time to talk to loved ones about your future.

If you want to draw up a will and name your brother as executor, you can have a conversation with him about it while you’re both heading to the airport to pick up your parents. Should you want to talk to your sister about naming her and her husband as guardians for your children, you can do so when you’re all relaxing after a holiday dinner.

3. Big Changes Take Place During the Holidays

Have you ever noticed how big things happen during the holiday season? People propose to their long-term partners in front of the Christmas tree or announce the coming of a new arrival while gifts are being unwrapped.

You may find yourself welcoming a new son or daughter-in-law or grandchild in 2024. Why not create an estate plan that includes an education fund for the baby or adds your child’s new spouse to your list of beneficiaries?

An estate plan can even help you and your family deal with the news that’s less than positive. For example, if your grandson has been diagnosed with a developmental disability, setting up a special needs trust can provide for their future without jeopardizing their access to public benefits.

4. You’ve Added Something Expensive to Your Estate

The holidays are a time when presents are exchanged, and not all of them are gift certificates or the latest electronics. During this time, many families give one another large sums of money or expensive items like cars or real estate. Search ‘new car for Christmas’ on YouTube and you’ll be flooded with results (and some pretty hilarious reactions).

If your parents decide to surprise you with a bow-decked BMW in your driveway, you’ll want to take it for a spin first. But then you should consider how you want your family to manage it if something happens to you. An estate plan can cover the new car and any other important assets you may have.

5. You Deserve It

While planning for your loved ones and minimizing the effect of probate on your estate are both fundamental reasons for estate planning, they aren’t the only ones. A well-rounded plan will also provide for your future.

In the event you become incapacitated (or unreachable due to travel or other reasons) a revocable or living trust will hold your money and property for your benefit while you are alive and names the beneficiaries who will receive your property after you die. An irrevocable trust can protect your estate from creditors should you ever run into financial difficulties.

It is also important to name a durable power of attorney to make decisions on your behalf if you become physically or mentally disabled. A living will and healthcare proxy, agent or power of attorney can help ensure that you receive the medical care you need and want when you are unable to make decisions for yourself.

Celebrate 2024 With a New Estate Plan

Holidays are a time when the whole family comes together to celebrate the season and all they have to be grateful for. This is a time for closeness and looking forward to the future, making it the perfect time to protect yourself and your family with a complete estate plan during 2024.