Quora Answer: Why Should People Not Ignore Estate Planning?

The following is my answer to a Quora question: “Why should people not ignore estate planning?”

Estate planning is about securing the assets of the deceased, according to his wishes, for the benefit of the next generation, or other designated beneficiaries.  Estate planning increases exponentially in importance the larger the estate. 

The first consideration of estate planning is about tax exposure.  The estate may be distributed across several different tax jurisdictions, and may need to be reorganised.  The assets in the asset may need to be restructured with trust structures or companies to reduce that tax exposure.  Many parts of the world have an estate tax.  There are ways of mitigating that tax bill. 

The second consideration is to protect the interests of your designated beneficiaries.  This is not simply about willing assets to them, but also about ensuring they receive it in a manner that they can actually benefit from the asset.  This pertains to issues such as accessibility, legacy costs, and so forth.  There should also be provisions for beneficiaries are below the age of majority, or not in a position to represent themselves, such as beneficiaries of unsound mind or intellectually diminished. 

The third consideration is to prevent litigation and infighting among claimants.  This would destroy the family, and the lawyers and the government would come in and get much of it.  This also includes consideration for property in joint tenancy, shares which are pledged, and insurance policies which should be nominated.