One interesting thing about the asset protection field is how many areas of law overlap. To run an effective practice, asset protection attorneys have to have a thorough understanding of business law, tax law, real estate, and yes, estate planning. Sometimes, clients are confused as to why our firm, which serves primarily real estate investors and focuses on lawsuit prevention, would even care about estate planning. Well, that’s because our experience has shown us that estate planning is part of your asset protection plan. Our job is to defend assets, which can outlive you–so of course you need to plan for what to do with them.
Many of the other structures we use to defend your assets such as LLCs or other entities, investment vehicles, and certain types of retirement accounts have many rules, regulations, and restrictions about who is eligible to use them and how. Most legal structures do. So it’s only natural to wonder what rules apply to your estate plan. Let’s get right to the good news.
Estate Plans: Can Anyone Have One, or Are There Restrictions?
Anyone on earth can (and should) create an estate plan. We will all die eventually, and there are many clear benefits of estate planning we’ve discussed before. Estate planning allows us to prepare for this inevitability, provide for our loved ones, and direct our assets to exactly where we want them to go.
You do not need anything special to get an estate plan. You don’t even need to explain why you want one. Estate plans are universally available to everyone. Think of estate planning like car insurance, but better. We buy insurance to protect us in case we get in an accident. Insurance and estate planning are both proactive measures you take to offset the pain of an unexpected loss (whether vehicular or of your life). Well, you may or may not crash your car, but the odds of death are 100%. You wouldn’t think about driving without car insurance, knowing you may never even need it. By the same logic, you shouldn’t even think about avoiding estate planning, as the consequence of dying without one will actually be visited upon your family and loved ones. Estate planning lets you die, well, politely, while also getting to control exactly where your assets go and who will run your business.
When is the Right Time to Make an Estate Plan?
The ideal time to make an estate plan was actually yesterday. But since our mad scientists at Royal Legal Labs have yet to crack the formula for a time machine, today’s just as good.
All kidding aside, the sooner you can make your estate plan, the better. Recall that estate planning is available to everyone. Which legal tools will be most appropriate will depend on your personal situation, where you live, and many other details your legal and tax professionals will need to know. Recall that estate planning’s connection to asset protection seems obvious to any attorney with asset protection experience. But since you have the flexibility of being able to opt for other kinds of attorneys to create your estate plan, be aware that not all lawyers understand estate planning equally well. For instance, many attorneys have a go-to estate planning strategy that is already legally sound, then tailoring the forms to clients’ individual needs.
We’ve established that emergencies can happen to anyone. Estate planning isn’t about just anticipating your inevitable death either. We use many estate planning tools to ensure your wishes are carried out if you’re ever in any kind of emergency where you’re unable to make decisions. It’s a way to protect your business and assets during life and beyond. But the estate plan can only work if you bother to make it. In our opinion, the consequences of dying without an estate plan are too high.
Aren’t Estate Plans For People Who Are Sick or Dying?
Certainly not. At least not exclusively, and in fact, estate planning matters in life as well. Just because we all know we will die someday doesn’t mean we know when. While we may associate estate planning with sickness or old age, assuming you don’t have to worry about estate planning until an emergency happens is foolish.
The reality is none of us are immune from unexpected illnesses, traumas, freak accidents, or even heavy objects falling from above. Estate planning is the only way
Bottom Line: Estate Plans Should Be Crafted to You
Check out our educational resource about the most effective legal tools asset for estate planning for REIs. But keep in mind that the most important thing isn’t what you use, it’s that you use the things suitable to you. Doing your own research is wonderful. We encourage you to use our free educational resources as much as you like, and read even more on top of that. But given how important this issue is, this research should just be your starting point. Use it to form questions for the legal professionals assisting with your estate plan.