Friday, August 12, 2011

The Importance of an Estate Plan at Any Age

I just read the article below and thought it was interesting and important to share. 

Amy Winehouse had many ups and downs during her short life, but it appears the singer/songwriter left behind an up-to-date and ironclad estate plan. Winehouse's tragic death at age 27 illustrates why you are never too young for a will.

Winehouse and Blake Fielder-Civil were married briefly. Under English law, marriage negates any wills made before the marriage, but if a couple divorces and there is no new will, the ex-spouse is the favored beneficiary. Fortunately, Winehouse reportedly updated her will to ensure that Fielder-Civil, who is currently in jail for burglary and possession of an imitation firearm, would not inherit any of her estate. Under Winehouse's will her fortune, estimated at $16 million, will go to her divorced parents and her brother.

In the United States, if you die without a will, the state dictates who will inherit from you. If you are married, most states award one-third to one-half of your estate to your spouse, with the rest divided among your children or, if you don't have children, to other living relatives such as your parents or siblings. If you are single, most states provide that your estate will go to your children or to other living relatives if you don't have children. If you have absolutely no living relatives, then your estate will go to the state.

If you have accumulated some assets (it doesn't have to be Winehouse's millions) or have young children that will need a guardian, then it is time to start thinking about an estate plan. Planning your estate with a will or trust is the best way to ensure your estate is distributed the way you want it to.

Not long ago I was talking to a colleague that had recently become a father.  I jokingly said “now that you have a child you need a will and I know people who can put one together for you”  The   guy looked at me with shock on his face and said “what do you think I’m about to die”.  I was amazed that he thought a will was only for the elderly.  It’s unfortunate that this is the way many people think about estate planning.  I know of several people who died unexpectedly at a young age and it caused their family stress, confusion and a great deal of sadness when they had to make decisions not knowing what their child would have wanted.  I say to people all the time that putting together a will, living will and powers of attorney are like a gift to your family and I truly believe that.