The Myths We Tell Ourselves About Estate Planning

Estate planning is important for everyone, not just the wealthy or the elderly. It's about protecting your loved ones and having a voice when you can no longer speak for yourself. One common myth is that only the rich need an estate plan, but it's about more than just money. Another myth is that your spouse will automatically get everything, but this can be risky, especially in blended families. Having a will does not avoid probate, and probate can be a slow and public process. There are alternatives to probate, but planning ahead is key. Estate planning is about love and clarity, and it's a process that reflects your life and values. It's important to think about who you trust to make decisions for you and what you want to happen to your belongings. If you're unsure, it's best to talk to a professional estate planning attorney. Hello everyone and welcome back to Living in the Past, I'm your host Robert Nagy, the estate planning attorney based in Maryland and a visitor to Columbia. Today we're going to get into something that many people avoid, delay, or even misunderstand, that's estate planning. Now before you hit the pause button, hear me out, estate planning isn't just for the wealthy or the elderly, it's for everyone, yes, even you, even your neighbor, even your 35-year-old friend who just had their first child. If you're an adult, if you own anything, if you're breathing, if you care about who makes decisions for you, if you can't, then you have an estate and you need a plan, but we're human. We like to put things off, we rationalize, we tell ourselves stories that let us push the uncomfortable stuff to the side, and I call these myths, and they're more common than you think. The myths around estate planning are persistent and they're powerful, but today we're going to unpack a few of the most common ones and talk about why believing them can actually do more harm than good. So let's start with one of the biggest misconceptions out there. Myth number one, only the rich need an estate plan. This idea is everywhere. It is hands down the number one myth I hear. We see estate planning stories in the media when a celebrity dies without a will or when there's a big fight over a business empire, so it's no surprise that the average person might think, I don't have millions in assets, it's only for people with private jets and five homes. Why would I need to do anything like that? But here's the reality. Estate planning is not just about how much money you have. It's about having a voice when you can no longer speak for yourself. It's about protecting your loved ones from chaos and confusion. Estate planning is about you, your values, your wishes, your people. Sure it covers who gets what after you're gone, but that's just one piece of the puzzle. It also covers what happens if you're alive but unable to make decisions for yourself. Think about illness, injury, dementia. These are all very real possibilities for all of us, regardless of age or income. Let me give you a real world example. Imagine you're becoming capacitated. Maybe it's due to an accident or a sudden illness and you can't make decisions for yourself. Who's stepping in for you? If you haven't legally named someone to make those decisions, a court's going to do it for you. In that court process, it's public, it's time consuming, it's expensive, and it might result in someone who you would never have chosen to be given control over your finances or even make the healthcare decisions for you. Even if you don't own a big house or business, you still have stuff, bank accounts, personal belongings, sentimental items, and you probably have opinions about where you want those to go. Estate planning gives you the power to make those decisions now so your family isn't left guessing or worse, arguing. I like to say if you care about what happens to your stuff, your body, or your family, estate planning is for you, not just the rich. You don't need to be rich. You just need to care about how things are handled when you can't do it yourself. Myth number two, I don't have to plan because my spouse will get everything. This is also a very common myth and very common among married couples. Yes, in many cases, property that's jointly owned passes to the surviving spouse, but the assumption that this will always happen smoothly and that's always the best outcome can be risky. Let me walk you through why. Let's say you and your spouse own a house. You check the account and your investments jointly. When one of you passes away, those things automatically pass to the other. That part is true. What happens if the surviving spouse gets remarried or faces a lawsuit or goes into long-term care and needs Medicaid? All of those assets are unprotected and fully available. That can mean your kid's inheritance is wiped out by paying for care or ends up in the hands of a new spouse. Here's another wrinkle, blended families. Maybe you have kids from a prior marriage or prior relationship or your spouse does. If you pass away and everything goes outright to your spouse, there's no legal guarantee that your children will inherit anything down the line. It's not about trust. It's about protection. I don't know about you, but as an attorney and as an individual, I've seen enough blended family dynamics to know that not everyone gets along the way we hope. Having an estate plan means you and your spouse sit down together, talk about what you want, put the protections in place so your shared vision is honored. Maybe that's a trust that provides for your spouse but also protects for the rest of your children. It's you making sure your beneficiary designations and titling are consistent with your goals. The bottom line, if you really want to care for your spouse and the people you love, planning together is key. Myth number three, a will avoids probate. This one often catches people by surprise, but let's be honest, creating a will feels like a responsible adult move. You're adulting when you do this. You're with the grown folks table when you do a will. You go to an attorney or maybe even draft one online, sign it and feel like you've checked that grown up box. By the way, the sidebar, I never advise drafting your will online, regardless of what Matthew Stafford and his wife says in their commercials. Please keep this adage in mind. You pay now or pay later when considering doing your estate plan online. We can talk about that another time. I'll do another episode on just the issues with doing your estate plan online. All right, where were we? Oh, yeah. Having a will is a great step, but it's not the end of the story. A will must go through probate. A will is really just a letter to the court, to the probate court. It doesn't avoid probate. It sends the estate straight into it. That means it's submitted to the court. It becomes part of the public record. Your estate is subject to a legal process before anything is distributed. That process can vary in complexity and length depending on your estate and your family dynamics, but it's not something that happens overnight. Now, probate isn't always a nightmare, but it's a legal process. It is public and it can be slow. If there's any disagreement in your family, like if Cousin Jane thinks she was supposed to get the house or your kids don't see eye to eye, it can get messy very quickly. And remember what I always say, that if you want to see people change, show me a sick body or a dead body with money. And if you don't believe me, you just haven't lived long enough. And remember, even in unsupervised probate, your personal finances, debts, and decisions become part of the public record. Your family may have to publish notices in the newspaper, and they may have to notify creditors. It's a lot. If you're looking for privacy and simplicity, a will alone is not going to get you there. Fortunately, there are alternatives. You can avoid probate altogether with tools like a revocable living trust, beneficiary designations, transfer on death accounts, and many more. But, again, these only work if you plan ahead. Let me also say this, probate isn't inherently bad. In some cases, it's perfectly acceptable. It's maybe the best route in your circumstance. But if privacy, speed, and reducing costs matter to you and your family, then it's worth exploring other options now as part of a comprehensive estate plan. So what's the takeaway here? Please don't let these myths keep you from taking control. Estate planning isn't about fear. It's about love. It's about clarity. It's about making life easier for people you care about most during a time that will already be hard, whether it's incapacity or you've passed away. You don't have to have millions, a mansion or millions in the bank. You don't have to disinherit your spouse or avoid every court process. You just have to have a plan. You just have to plan ahead. Estate planning isn't just for the wealthy. It's not just for people in their 70s. And it's not a one-and-done situation. It's a revolving process that reflects your life, your circumstances, your values, and your relationships. If you've been holding off because you thought you didn't need it, I want to challenge you to think about a few things today. Ask yourself, who do I trust to make medical and financial decisions for me if I can't? What do I want to happen to my belongings, even the small stuff, the sentimental stuff? And if I'm gone tomorrow, will my family know what to do? Will they know what to do with my body? Will they know what to do with my stuff? Will my family be taken care of? If you're not sure about these answers, it might be time to talk to a professional estate planning attorney, someone who can guide you through it and help you answer your questions and help you build something that really works. Hey, that's what I'm here for. I'm always happy to chat with listeners. So answering estate planning questions will help you get started on the right path. That's why we do our complimentary discovery sessions. So if you're interested, by all means, schedule yourself for a discovery session and we can have that chat. Thanks for listening to this episode of Living with the Bags Pack. If you found this episode helpful, do me a favor, share it with a friend. Or better yet, talk to someone you care about and ask them if they've started their estate plan. I'm Robert Newman, reminding you that peace of mind isn't just for some day, it's for today. Until next time, take care and plan well. Now here's my lawyer disclaimer. None of this is legal advice. Every situation is different and your estate plan should be tailored to your unique needs. So if you're not sure how to proceed or what makes sense for you, talk to a qualified estate planning attorney. Yes, even if it's not me, but still talk to a professional qualified estate attorney.