Estate Planning: It's for Everybody

November 21, 2012 (Press-News.org) Estate planning: It's for everybody

Pennsylvanians of all ages and income levels, take note: estate planning can benefit you. Many people of modest means believe that only the wealthy need to plan ahead for what will happen to their possessions, but that is a misconception.

Why everyone needs to plan

The future is uncertain, and people cannot predict their life span or when the need for estate planning will arise. It is better to plan early and have decades of peace of mind than to wait until it is too late. Plans can be readily changed throughout a lifetime, so there is no such thing as planning too early.

People need to disregard the common myth that estate planningis all about estate taxes. Such taxes are an issue for people who have amassed more than about five million dollars in assets, much more than most of us will ever see. However, estate planning concerns much more than taxes.

Planning ahead ensures people's financial and health care wishes are carried out the way they want, even if they become incapacitated and unable to participate actively in decision making. It is also about choosing how to distribute money and property in order to take care of children and other loved ones.

The importance of a will

A will is especially important for people who have minor children, as the document can specify who will act as the children's guardian if no parent is available. If there is no will, a court decides guardianship, and the court's decision may not be in accord with what the parents would have wanted.

The will also distributes a person's possessions to his or her heirs.

Options in Pennsylvania

Pennsylvania law allows two people to own property in joint tenancy with right of survivorship. If one owner dies, the other is automatically the owner of the property, with no need for probate. Joint tenancy works for real estate, bank accounts and other kinds of property. Married couples in Pennsylvania have another option, called tenancy in the entirety, which works like joint tenancy.

Another way to transfer property in Pennsylvania without a will is a payment on death designation, which names a beneficiary for a bank account. The owner of the account is in full control of the assets, but at the owner's death the designated beneficiary becomes owner of the account.

Additional Considerations

This is just a sample of what can be done with estate planning. For a thorough review of the choices available, those embarking on estate planning will benefit from the help of an attorney who is experienced in this area. Each situation is unique, and an attorney can help determine what will best serve each individual.

Article provided by Spencer Law Firm
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