Minnesota estate planning lawyers regularly battle the misconception that estate planning is something that only wealthy people need to do. They may hear about “trust funds” and “estate taxes” and falsely believe these things only apply to the super-rich. Unfortunately, these folks often end up costing their heirs considerable time and money because they didn’t realize that these terms applied to them, too.
Small or Large- You Have An Estate
The word “estate” itself can be a reason for the not-so-wealthy to skip out on planning here in Minnesota. It often brings to mind mansions with grand rolling hills and perhaps a stock portfolio to help with the payroll of personal chefs and gardeners. In reality, however, the word “estate” refers to any assets that an individual owns. Some examples might include:
- Your home
- Insurance policies
- Retirement plans
- Bank accounts
- Personal belongings
When you see it listed out like that, it is clearer that nearly every one of us has what is legally considered an “estate.” Not to mention, when you add up the value of these assets, the need for estate tax planning may no longer seem so far away. Minnesota estate tax comes into play if the value of everything you own, including any life insurance proceeds, is over 1 million dollars. Many individuals reach this threshold much sooner than expected. It makes sense, then, that you would want to have a say in what becomes of those things once you pass away.
How Wills and Trusts Can Work For You
Even with a small estate, in Minnesota, the only way you can have a real say in what happens to your belongings is by creating a legally binding estate plan. Keep in mind, too, an estate plan isn’t just for when you die; documents such as Powers of Attorney and Healthcare Directives also direct how things will be handled should you become incapacitated temporarily or permanently. Your Minnesota will and trust attorney will help you determine what kinds of medical decisions you would want made, for example, rather than only focusing on selecting beneficiaries for your accounts and jewelry.
If you have minor children, then the need for an estate plan can become even more pressing, as it affords you the opportunity to name your choice of guardians for your children. Without a legal guardianship set up in advance, the courts will use specific laws and precedents to determine where your children will live and with whom; and the court’s decision may be very different from what you would have chosen.
Weighing The Consequences of Minnesota Probate
When you pass away without a solid estate plan, your entire estate—no matter how big or small—could be subject to probate here in Minnesota. As with choosing guardians, this court-established process is based entirely on legal precedent and not on your wishes. Someone will be chosen to distribute your estate according to statute and decisions made by the court. While Minnesota law has tried to make the probate process relatively easy – it still costs time and money.
Working with a Minnesota trusts and estates attorney is your best approach for protecting what you have, whether it’s that sprawling mansion on the hill or just a few special pieces of jewelry which were passed down by your grandmother. To learn more about creating a plan which fully protects the people and things you love, give us a call at (763) 244-2949 and ask to schedule your Personal Strategy Session.