Estate planning is beneficial for every individual. But the more assets you own, the more important it is to take a proactive approach. From tax obligations and probate, to medical decisions and family dynamics, estate planning provides loved ones clear answers to difficult questions.
One recent study, however, offers a puzzling conclusion: A large number of people with significant assets haven’t prepared a single estate planning document, putting their legacy at risk.
The number of people with a will has dropped
The 2020 Estate Planning and Wills Study comes from YouGov and Caring.com. Surveyors asked 2,400 Americans about their estate planning preparedness, with results broken down by demographic.
Troublingly, the number of middle-aged and older Americans that said they have a will fell significantly from the prior year. About one in four adults aged 35-54, and 49.7% of individuals 55 and older, reported having a will. Both figures represent double-digit drops from the previous survey.
Just as worrying are the findings when broken down by an individual’s wealth. According to the survey, more than half of people making $80,000 and up do not have a single estate planning document prepared.
For those individuals, an untimely tragedy would leave their estate in a tangle – with their surviving loved ones left to undo the messy knot.
The consequences of not having an estate plan
A good estate plan does far more than simply direct specific assets (such as a home or family heirloom) to certain loved ones. Instead, it should account for the totality of your situation. Without these vital documents, your estate and close family members may be significantly impacted by:
- Complicated tax obligations
- A lengthy, expensive probate process
- Disputes over your inheritance intentions
- A lack of clarity surrounding your medical care wishes
- Gaps in financial planning for the long-term care of a partner or child with disabilities
Helping loved ones avoid these sources of stress and uncertainty – while making sure wishes are respected – is a priority for many people. The only way to do this, however, is to take time now and create an estate plan.
It’s a small price to pay for peace of mind.