Estate and Gift Planning Awareness; No Estate and Gift Plan Means No Control
Estate and gift planning, an often undervalued aspect of financial management, plays a crucial role in protecting the interests and welfare of one’s dependents after death. These plans typically encompass directives regarding the allocation and handling of assets, directives for minor children if applicable, and instructions related to retirement accounts.
Many people consider estate and gift planning something that only wealthy or older individuals do. But the fact is, estate and gift planning is beneficial and affordable for everyone. Not having an estate and gift plan in place can cause financial and emotional hardship for your family down the road. For many reasons, it’s quite risky not to have an estate and gift plan in place.
CONSEQUENCES OF NOT HAVING AN ESTATE AND GIFT PLAN
No Control Over How Assets are Distributed Upon Death
When a loved one passes away, it is a deeply emotional time for the family. What could make matters worse is if there is no clear plan on how to distribute assets. Without a will or trust, the assets are considered intestate, and items will be given out according to the law of the country; in Ghana, Instastate Succession Act, 1985 (PNDC Law 111). This could result in someone that should clearly receive something not getting anything and others that are less emotionally tied to items receiving them.
The lack of an estate and gift plan also opens up the possibility of an ugly family dispute when someone passes away. Often there is a feeling of entitlement to the property with more than one member of the family and no clear way for it to be divided fairly. The resulting decision is doomed to be perceived poorly and could lead to resentment among family members which can make the emotional toll much worse.
No Control Over Medical and Financial Decisions if Incapacitated
An estate and gift plan doesn’t just cover someone’s family in the event of their death. It also details out how to handle situations if the person becomes unable to make their own decisions.
With no plan in place, someone could petition the court to control assets and make decisions for you that wouldn’t be in your best interest. The result of this could be disastrous for your health and finances.
An estate and gift plan allows you to select the representatives you want, ensuring that you will be in good hands if you become incapacitated. This becomes even more critical in end-of-life situations.
No Control Over The Fate of Children
Ensuring the safe fate of your children should be reason alone to set up an estate and gift plan. In the event something happens to you and your spouse, the fate of your minor children, would be up to the courts if you don’t have an estate and gift plan in place. Part of the estate and gift planning process is creating documentation that allows you to choose who would raise your children if something were to happen. In addition, an estate and gift plan also helps protect the inheritance of children should something happen to you before they are old enough to maintain it themselves properly. Creditors and other entities could get involved in the inheritance that is supposed to be theirs if something isn’t in a place that separates it.
The implications of negating such planning can be significant, leading to potential legal complications, tax implications, and an unintended distribution of assets.
The absence of an estate and gift plan postulates a condition known as intestacy, where the government assumes control over the distribution process according to its intestate laws. This scenario can give rise to disputes among beneficiaries due to perceived inequitable asset division or misinterpretation of the deceased’s wishes. It further complicates matters when minor children are involved or unique types of assets exist in the portfolio.
In essence, effective estate and gift planning serves as an invaluable tool for individuals seeking to secure their legacy and protect loved ones’ financial futures.
Register to attend National Estate and Gift Planning Awareness Conference 2023
