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An effective estate plan is critical to protect your assets and ensure a comfortable future for your loved ones after you die. Various legal instruments in Arizona can help protect your finances, account for your needs as you age, and minimize tax consequences on your estate. Consulting a Buckeye estate attorney can help you employ the best strategies and leave a clear and lasting legacy behind.
What are Assets?
Assets include all the property you own, such as:
- Real estate
- Bank accounts
- Investments
- Life insurance policies
- Business ownership interests
- Vehicles
- Jewelry
- Artwork and antiques
Why Should I Protect My Assets?
You’ve worked hard to build assets. If you don’t protect them, they could be lost to creditor claims, lawsuits, and bankruptcy. Estate planning can employ various asset protection strategies to prevent your property from being seized and ensure it passes to the heirs you choose.
Protecting your assets is also crucial as you consider your future and long-term care planning. Public assistance programs like Medicaid can help you afford nursing home care, but they have strict income and asset limits. Thoughtful estate planning allows you to make asset transfers or use trusts to qualify for Medicaid without spending down your estate.
Strategies for Asset Protection in Estate Planning
Common estate planning tools that can help you protect your assets include:
- Wills – A last will and testament allows you to designate someone to administer your estate and name who will inherit the assets upon your death.
- Trusts – Revocable and irrevocable trusts allow you to protect assets from creditors and pass your wealth to loved ones without the time and expense of probate.
- Joint ownership – Owning property jointly with a spouse or loved one allows the property to pass directly to them and bypass probate.
- Designated beneficiaries – Do you have a life insurance policy or retirement account? Make sure to name who you want to receive those proceeds when you pass. Otherwise, your assets may become part of your estate. If you don’t name someone in your will to receive your assets, they will be distributed according to Arizona law, which might not align with your preferences.
Common Pitfalls in Estate Planning and How to Avoid Them
Common mistakes that people make with estate planning include:
- Procrastination – Too many people wait until faced with a medical or personal emergency to begin the estate planning process. Waiting too long compounds stress and may limit your options when trying to qualify for Medicaid or long-term care insurance.
- Not communicating with loved ones – Not being upfront about the specifics of an estate plan can lead to hard feelings and conflicts after you’ve passed. Family members might feel wrongly excluded or assume that others unduly influenced your decisions.
- Not updating your estate plan – An estate plan needs regular reviews to accommodate changes in your family circumstances, finances, or the law.
- Undertaking estate planning alone – Relying on do-it-yourself estate planning kits without legal counsel may cause you to miss critical details or beneficial estate planning tools that could help you achieve your goals.
Contact a Buckeye Estate Attorney Today
An estate planning attorney from Pennington Law, PLLC, can determine what estate planning tools can help protect your assets and prepare for the future. Call or contact us today for a free consultation with a Buckeye estate planning lawyer.
