One of the most common things I hear when I talk to people about estate planning is, “My family already knows what I want.”

And we understand that.

Maybe you’ve had conversations with your spouse about what should happen to the house. Maybe your children know who you would want to make decisions for you. Maybe everyone understands that you want your assets divided equally.

You trust your family. You believe they’ll do the right thing.

The problem is that knowing what you want and having the legal authority to carry out those wishes are two very different things.

I’ve seen families who were completely on the same page still run into problems after a loved one passed away or became incapacitated. They knew exactly what Mom or Dad wanted, but they didn’t have the documents or legal arrangements necessary to act on those wishes.

And when that happens, good intentions aren’t always enough.

Your Family Can’t Always Act Just Because They’re Family

A common misconception is that your spouse or children automatically have the authority to handle your finances or make decisions for you if you become unable to do so.

That isn’t necessarily the case.

If you become incapacitated, your family may need specific legal documents giving them authority to manage your financial affairs, communicate with institutions, or make certain decisions on your behalf.

Without proper planning, your loved ones may have to go through a court process to obtain that authority.

Imagine being in the middle of a medical emergency and your family is simultaneously trying to figure out how to pay your mortgage, access your accounts, manage your property, or handle other financial responsibilities.

That is not the time you want your family asking, “What are we legally allowed to do?”

Those decisions should have been made long before the emergency happens.

A Will Only Takes Effect After You Die

Another misunderstanding I hear often is, “I already have a will, so my family is protected.”

A will is important, but it only controls what happens to certain assets after you die.

It does not give someone authority to manage your affairs while you are alive but incapacitated.

That is why a complete estate plan often includes documents that address both situations: what happens after death and what happens if you are still alive but unable to make decisions for yourself.

Your estate plan should account for the possibility that you may need help before your family ever has to deal with your death.

Your Children May Not Automatically Get Everything

People also sometimes assume that if something happens to both parents, their children will simply inherit everything.

But inheritance can become much more complicated depending on how assets are owned, whether there are beneficiary designations, whether a trust is involved, and whether probate is required.

And if your children are minors, the situation becomes even more important.

Who would take care of them?

Who would manage the money they inherit?

Would the person you trust to raise your children also be the person you want managing their inheritance?

Those are separate decisions, and they should be addressed intentionally.

Simply assuming that “the family will figure it out” leaves important decisions in the hands of circumstances, courts, and default legal rules.

For more information, contact our office at Askew & Associates, P.A. by calling 954-546-2699.

Disclaimer: this blog post is not intended to be legal advice. We highly recommend speaking to an attorney if you have any legal concerns.