Why do you need Estate Planning?

First, it's important to understand what the term "estate planning" actually means. Today, we use the word "estate" different than what was originally intended. In today's society the word "estate" is used as a synonym for "wealth." So the reference to an "estate home" conjures the impression of a mansion. A reference to the "estates division" of a bank seems like it would be the banking services for rich people. But the original meaning of the word "estate" was simply whatever a person owned at the time of their death. There are a lot of people who think they don't need to do "estate planning" because they are not "rich." That's unfortunate because the fact is, whether a person has a large estate or a modest one, they still want their estate to go to the people they choose. It would probably be better if "estate planning" was actually called "inheritance planning" so there would be no confusion. Unfortunately, it's not called "inheritance planning" it's still called "estate planning."

So the question comes back to... why do you need estate planning? There are many answers to that question, but almost all of them fall into one of three main categories: