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5 Common Estate Planning Myths in Iowa

On Behalf of | Nov 28, 2017 | Estate Planning

Estate planning is a topic that many people want to avoid. It can be complicated or uncomfortable to talk about death, dying, and what happens to your assets. However, an estate plan is essential to properly providing for your loved ones. It is also important for your peace of mind.

However, the path to accurate estate planning isn’t always straightforward. There are several myths about estate planning in Iowa, and many of these myths can confuse or mislead individuals trying to create a comprehensive plan. At Telpner Peterson Law Firm in Council Bluffs, here are five of the estate planning myths we hear most often.

#1: I Am Too Young to Worry About Estate Planning

Estate planning is not just for those who are sick or elderly. All adults should have an estate plan in place. It is impossible to predict accidents, injuries, and illnesses in life, and you want to be prepared at any age. This means putting together an initial estate plan while in your 20’s. At this age, you probably have some assets, and should decide who will receive those assets in the event of a tragedy or unpredictable event.

#2: A Will Is the Only Estate Planning Document I Need

The last will and testament is by far the most well known estate planning document in Iowa, but it is hardly the only piece of the puzzle. Estate planning attorneys employ several tools and strategies to ensure distribution of assets is handled effectively. This can include a trust, setup of bank accounts and 401K accounts, and arrangement of life insurance beneficiaries. Often, estate planning includes discussions and cooperation of your financial advisor and accountant, in addition to a knowledgeable attorney.

As well, several estate planning documents have nothing to do with asset distribution. Financial power of attorney and health care power of attorney specify the individual, or individuals, who have the power to make financial and health care decisions on your behalf. This can include important decisions regarding resuscitation and life support.

#3: I Am Not Wealthy Enough for Estate Planning

First, it is important to recognize that irrespective of wealth, every individual needs estate planning. Your last will and testament not only determines who receives real property, bank accounts, and other large assets, but also items of sentimental value. For many people, ensuring these sentimental pieces of property are given to the right people becomes the most important part of estate planning.

Second, estate planning is about much more than asset distribution. As discussed above, estate planning documents allow an individual to designate power of attorney for both finances and health care and provide directives to medical professionals regarding appropriate and preferred care. No matter how big or small your estate, these documents are an important part of your conversations with an estate planning attorney.

#4: I Need a Trust to Avoid Probate in Iowa

Trusts are regarded as the best way to avoid the Iowa probate process.  Sometimes a trust is the way to do this, but there are other options. These other options are usually less costly.

Most jointly owned property can pass to the co-owner without probate. As well, retirement plans, life insurance policies, and similar accounts can pass outside probate if there is a named beneficiary. Finally, checking and savings accounts, brokerage accounts, and other bank accounts can be setup as payable on death, which is another great option for avoiding probate.

#5: I Made an Estate Plan, I Am Finished with Estate Planning

Estate planning requires maintenance. What you setup in your early 20’s is likely inapplicable or inaccurate in your late 30’s. During this timeframe, it is likely you got married, had children, increased your salary, or made a substantial purchase. When these major life events occur, it affects your estate plan. Throughout your lifetime, your estate plan will go through several iterations and revisions.

Working with an Estate Planning Attorney

Another common myth is you do not need an estate planning attorney to create an effective estate plan. Often, a conversation with an Iowa lawyer clarifies many of these myths and misconceptions, and also ensures your estate plan is accurate. In Council Bluffs, IA, Jack Ruesch has a reputation for providing efficient and cost-effective estate planning advice. His practice at Telpner Peterson Law Firm is comprehensive and considers all aspects of estate planning. Contact our office today by calling 712-309-3738.