Women are breaking the glass ceiling, building steady careers, putting up their own businesses, and increasing their earning capacity. With women having more presence in the professional world, it’s becoming increasingly important for them to protect their hard-earned assets and take control.
This can be done through estate planning. Attorney Philip J. Ruce of Stone Arch Law met with WCCO to talk about estate planning for women, touching on its importance, how to protect assets, wills vs. revocable trusts, when it’s too late to plan an estate, and more.
Listen to the full interview below with host Jearlyn Steele of Steele Talkin’ and Attorney Ruce.
Key Discussion Points
What is Estate Planning for Women?
When a person passes away, the assets that they have to their name will be divided among their loved ones. Without a will, the division follows the default rules of intestacy statutes whether they like it or not.
In order to have more control of the division and to be able to dictate where the assets will go, an individual should replace those rules with an estate plan. Estate planning is creating a document that reflects a person’s rules, plans, and values when it comes to the division of their assets. It overwrites the default rules and allows a person to control where their hard-earned assets go after death.
Why is Estate Planning Important For Women?
Women are shattering stereotypes and earning more than ever before. There has become a big shift in wealth and responsibility among women, which calls for a plan to control their hard-earned money. Women should be empowered to make their own decisions about their wealth and how they want it managed or divided.
Further, women are outliving men and hence, become the first stop for marital assets. It is predicted that women will control the majority of the wealth in the United States by 2030. That in itself is an important reason to get estate planning done.
Protecting Assets Through Estate Planning
In order to protect hard-earned assets, a person should make sure that they’re communicating their wishes. Plans work better in the light of day, so it’s important that women are voicing out their rules on dividing their assets in an estate planning document. With this communication, women retain control over what happens to their wealth after death and there’s less likely to be any anger and fighting among family members and loved ones.
An estate plan empowers a woman to decide who manages their assets, who settles the estate, who receives certain assets, who will take care of their kids, and more.
Including Kids in an Estate Plan
While the default rules of intestacy statutes include all children in the division of assets, the control given in estate planning allows a person to remove a child from their beneficiaries. This also extends to dictating whether the kids get equal inheritances or uneven shares. These provisions don’t happen automatically. Instead, they need to be done intentionally and be bluntly indicated in an estate plan.
Wills vs. Revocable Trusts
There’s a common misconception that having an estate plan allows a person’s assets to avoid court. However, that’s not completely the case. There are two common types of estate planning documents, a will and a revocable trust. Wills don’t avoid the court process of probate, but revocable trusts do.
A will is a document that controls probate and tells the judge what to do. It makes the court process happen on its own terms, dictating who is in charge of the estate, where the money goes, who the backup beneficiaries are, etc. While wills don’t avoid court, they do make the process of dividing assets easier for loved ones.
Also called a living trust, a revocable trust is a private family agreement where all assets go. Because it is a private entity, trusts do not go through probate and the assets in it are automatically transferred to the designated beneficiaries upon death.
Nowadays, women’s assets such as 401ks and IRAs are getting bigger. Hence, a trust may be a more viable option if they want to pass free of a judge. As long as the revocable trust has clearly outlined beneficiary designations, the transfer of assets is almost instant and as a bonus, is private and confidential.
When is it Too Late to Plan an Estate?
A common worry, not only among women but across all genders and ages, is that it might be too late to plan their estates. But it’s never too late to start creating an estate plan and taking control. Some people do it in their 20s and 30s, which is ideal, but there are also those who only start at 75 or 80 years of age.
Regardless, no one should feel guilty about not having an estate plan yet. It’s never too late, but it’s recommended that it be done as soon as possible.
Does a Will Need to Be Updated?
The assets that a person has now are not the assets they will have forever. As women continue to be successful in life, it’s important that they continue updating their will with their current state of life. Ideally, wills should be updated or redone every 10 years to avoid bringing an outdated will to court, which will cause more harm than good.
Why You Need a Lawyer for Estate Planning
Estate planning documents often involve complex language and legalese because they go through the court system. The terms can be confusing for a lot of people, which is why it’s important to work with an estate planning attorney.
A lawyer can help make complex terms more understandable and provide guidance through all the stages and contingencies. With an estate planning attorney, a person will feel more confident about what they’re doing from start to finish.
Estate Planning for Women at Stone Arch Law
Stone Arch Law has helped women of every stage of life plan their estates. For clients who would prefer to work with a female estate planning attorney, they can talk directly with Attorney Camry Fielders. Schedule a free call with their team today.