New York residents may have heard the term legacy planning used interchangeably with estate planning. While similar, a legacy plan is more about taking steps to craft a reputation as opposed to merely transferring assets. It is generally seen as being proactive about establishing an estate plan as opposed to being reactive. One misconception about legacy planning is that it is egotistical to create one.
Some New Yorkers write their estate plans and then forget about them. When people fail to review and change their estate plans when they experience major life changes, there may be some unintended consequences.
People in New York who don't have substantial assets may not think they need an estate plan. However, regardless of one's financial standing, having a will is important.
According to a survey by Natixis, almost 70 percent of Millennials and other young people have an expectation that their parents will leave them an inheritance, but just 40 percent of parents plan to leave anything to their kids. Part of the disparity may stem from a simple lack of conversation and planning. Tennessee parents and their children may both approach the topic timorously, as it revolves around death. For all parties involved, though, it is important to have these discussions earlier rather than later.
In New York, estate planning ensures that people's wishes are met concerning their health care and assets at the end of their life. Documented instructions let relatives and health professionals know individuals' wishes regarding medical treatment and end-of-life instructions. An estate plan also answers questions about property disbursement after a person's death. However, there are several issues that people often do not think about before preparing their estate plan.
Individuals living in New York are often concerned about protecting themselves in case they become incapacitated and are unable to make decisions regarding finances, medical care and living arrangements. One way of ensuring that one's rights and needs will be respected is to give a trusted friend or family member durable power of attorney.
In some cases, New York residents fail to include their desires when it comes to final arrangements in their estate plans. In some of these cases, they trust their family members and loved ones to do the right thing. However, if a person is concerned that his or her family will not know what to do or the person has what may be considered an unusual request, those wishes need to be outlined in the estate plan.
New York business owners should consider an estate plan to protect their family and business in case they become incapacitated or pass away. One survey of over 500 entrepreneurs nationwide found that almost two-thirds of entrepreneurs had no estate planning documentation. More than three-fourths did not have a financial power of attorney, and only one-fourth had a will. Even fewer entrepreneurs reported having a living trust.
An irrevocable trust may be a good option for some people in New York who are creating an estate plan. Unlike the revocable variety, an irrevocable trust cannot be changed. However, it offers advantages in protecting assets that a revocable trust does not.
Beyond the romantic sentiment and vows before family and friends, marriage is also a legal contract that give rights and protections in medical emergencies, financial situations, the death of a spouse and other situations. New York couples who choose to forgo marriage in favor of cohabitation can also enjoy these benefits by understanding what those are and creating an estate plan.