If you ask the average person if they have an estate plan, odds are that they don’t. You may be surprised by this, but studies have consistently found that the majority of Americans don’t have an estate plan.
However, taking this approach – putting off estate planning for later – is very risky. Let’s consider just a few of the risks that you create if you don’t have a plan.
It can cause estate disputes
For one thing, lack of an estate plan increases the odds that there will be a dispute among your heirs. Even if they eventually solve it, they may never be on good terms again. If you can give them guidance, you can help things go smoothly so that they stay close.
You may not be able to make medical decisions
One of the biggest parts of estate planning is making medical decisions in advance and choosing an agent through a medical power of attorney. If you don’t have a plan in place, then you’re not going to have any say in the medical decisions if you’ve become incapacitated and unable to speak for yourself. This can happen at any age, which is why it’s wise to have a plan in place.
Your assets may not go to the right people
Finally, there’s obviously an issue if your assets don’t go to the heirs or other beneficiaries you intended. Simply telling people what you want them to have is often not enough. An estate plan is a legally binding document that helps ensure they will actually get what you intended.
As you can see, moving forward without an estate plan is simply an unnecessary risk. It is much safer to create a plan and then update it if you need to in the future. Just make sure that you know about all the legal steps you’ll need to take to do so.