Many people either decide not to write a will or procrastinate it and pass away before they get around to drafting an estate plan. According to some studies, the majority of people in the United States do not have an estate plan at this time. This means that many people are either anticipating doing it in the future – which may or may not happen – or they aren’t going to do it at all.
But there are some significant disadvantages that you may face if you opt not to create an estate plan. Below are just two common examples.
1. Your wishes may not be followed
First and foremost, passing away without a will means that you have died “intestate”. Rather than following your instructions about how to distribute your assets or other important steps to take, state laws will be used. Essentially, the government gets to decide what happens to your assets. This certainly may not be in line with what you would’ve wished for your family.
Additionally, some potential beneficiaries may be left out entirely. If your assets just go to your spouse and your children, for example, your grandchildren do not inherit anything.
2. Estate disputes are more likely
Another issue to keep in mind is that lacking an estate plan can increase the odds of an estate dispute. Your family members may not know what you want or they may disagree about your preferences. Children may fight over sentimental assets or how to divide up financial assets. There can be disagreements about what to do with major assets like a family home, a vacation home or a family business.
Some of these disputes can be avoided through the construction of an estate plan in advance. If you’re interested in doing so, just be sure you know what legal steps to take.