There are many things to consider when you have loved ones who depend on you.

Examples include the following: 

• Planning for retirement 

• Purchasing life insurance

• Saving for children's education

Estate planning is a unique aspect of adulthood that is necessary for people, but it is very easy to put off. Thus, procrastinating your estate plan might result in serious costs.

Guardianship

For parents with young children, nothing is more important than ensuring your children are looked after. If you have minor children, you should determine who will raise your children if both parents cannot, by naming guardians for them.

The only way to designate legal guardians in a manner that the courts will recognize is by doing so in your Will. Without a Will, it is left to the courts to appoint a legal guardian, resulting in unnecessary expenses and lawsuits that could put the children in the middle of a conflict. However, it is important to note that guardianship isn't only for minors.

Delayed Distributions

Naming a beneficiary in a Will would not allow that person to receive your assets immediately after your death. The assets that are distributed by a Will must go through probate.

Probate describes the process by which a court proves the Will of a deceased person and oversees the distribution of assets and payment of debts.

Avoiding the probate process is an invaluable benefit of having a good estate plan.

With proper planning, a thorough estate plan helps avoid the probate process altogether so the distribution of assets is as reasonable and efficient as possible. There is no gap in ownership or control when a Revocable Living Trust is the beneficiary or owner of an asset.

The creator of the Revocable Living Trust is typically the beneficiary and trustee of the trust. A trust document does provide for one or more successor trustees to administer the trust in the event of the trustee's disability or death. With no court involvement, there is no lengthy delay in the distribution of the trust assets to the beneficiary.

Unintended Omissions And Distributions

One of the most critical and devastating consequences of procrastinating on your estate planning could be unintended omissions and distributions, like:

1. Poorly drafted or outdated estate planning documents may remain binding even after a notable change in the family. A few words could be the difference between an entire generation being completely disinherited or inheriting a part of the estate.
2. Filing for the divorce does not disinherit the spouse. In Illinois, the ex-spouse is considered to have predeceased the creator of a Will or Revocable Living Trust. However, the laws of Illinois do not affect the documents until the divorce is final.
3. The third occurrence of unintended omissions or distributions is due to joint ownership. The surviving owners inherit the deceased owner's share automatically when an account is owned jointly with the right of survivorship.
4. Inaccurate beneficiary designations could result in unintended distributions of assets, which are often the largest in the estate. Beneficiary designations replace the conditions of a testamentary instrument like a Will. An insurance provider or bank would distribute the assets or account immediately to the named beneficiary without reviewing the deceased's estate plan or court approval.
   

Takeaway

The process of getting your estate plan in order is less painful than most people expect. When it is complete, you can rest assured that your loved ones will be looked after financially and personally. Updating your beneficiary designations is a crucial part of estate planning, and procrastinating  your estate plan can have significant consequences.

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