J. Kelly Kennedy, Attorney/CPA, PLLC

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Estate planning data from millionaires

In other posts, this blog has discussed the idea that many people in Florida avoid setting up a will or estate plan because they think that this kind of planning is only for the wealthy. Also, in general, people don't like thinking about the possibility of their own death or incapacitation. On the other hand, common sense would dictate that people who do have substantial assets might give estate planning more serious thought than others who have fewer assets. However, the data on this topic shows some surprising results.

The financial network, CNBC, conducted a survey in which it polled 750 millionaires. The data showed that 38 percent of the people with assets totaling $1 million or more have not bothered to meet with an estate planning professional. The amount of assets that the people in the poll had made some difference regarding their propensity to set up an estate plan, but the numbers were still interesting. For example, of the people who had $5 million or more in assets, 32 percent had not done any estate planning with a professional.

In addition to simply not wanting to deal with their own mortality, another reason why even millionaires have avoided estate planning could be due to recent changes and uncertainty with the federal estate tax laws. Under current law, the first $5.43 million of a person's estate is exempt from federal estate taxes. Accordingly, because many people think of estate planning as merely a means of minimizing the taxes on the distribution of their assets, they don't feel a need to bother with it.

As readers in the Polk County area know, however, estate planning involves more than just setting up strategies to avoid taxes. Some of the other important issues include health care decisions, protecting assets for children and other family members and deciding what should happen to a person's assets if they become mentally incapable of managing their estate.

An attorney who is experienced in drafting estate planning documents will know how to thoroughly address all of these issues. Estate plans make sense for many people, but what doesn't make sense is for those people to keep delaying the planning process.

Source: CNBC.com, "Wealthy suffer from 'estate-planning fatigue,'" Shelly Schwartz, June 29, 2015

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