The Hidden Costs of Doing Nothing: Why Not Having an Estate Plan Can Be a Costly Mistake
I know, I know, you’re probably wondering why a couple of real estate guys are writing an article about the need that most all of us have for an estate plan. Trust us, since having experienced 4 family losses since 2020, we are keenly aware of just how important it is for us to cover this subject with those we care so much about - namely YOU.
As many of you know, alongside our regular real estate practice, we are passionate about providing expert information and services for those who are serving as personal representatives, trustees, and agents under a durable power of attorney. We fully understand the risks that these roles carry, and also see the worst of what happens when this personal responsibility is left to be sorted out by others.
It’s easy to delay estate planning. After all, who wants to dwell on death, incapacity, or family conflict? But avoiding the topic doesn’t make it go away. In fact, it often creates chaos, confusion, and unintended consequences and families and loved ones are left with a significant burden during already difficult times.
Shockingly, most Americans don’t have even the most basic estate planning documents in place. Here are some startling statistics. According to a 2024 Caring.com survey:
67% of Americans do not have a will or any form of estate plan.
Among those aged 35–54, only 22% have a will.
Even among those aged 55 and older, nearly 1 in 3 lack basic estate planning documents.
The #1 reason cited? “I haven’t gotten around to it.”
Estate planning is not just for the wealthy. Whether you own a modest home, have young children, or simply want to spare your family future headaches, having a plan in place is a vital act of responsibility.
Here are our top 5 Negative Ramifications of Not Having an Estate Plan
1. The State Decides Who Inherits Your Assets
Without a will or trust, your assets are distributed according to state intestacy laws which may run completely counter to what you want to have happen. Failure to make your wishes known means that it is possible for estranged relatives to inherit your estate or ex-partners to be given control of assets meant for your children, while the people you care about, including unmarried partners or stepchildren, could be left out entirely.
2. Family Disputes and Litigation
Without clear instructions, disputes often arise among surviving family members. Believe us when we say that this can happen in any family! When the “who gets what, who’s in charge, and the mom promised that to me” disagreements get rolling it is amazing to witness the range of issues that re-surface, many of which go all the way back to the sand box. Under the grief and stress associated with a significant loss, these arguments can magnify and lead to long-term rifts, court battles, and legal fees that can consume a significant portion of an estate’s value.
3. Probate Delays and Costs
When there’s no estate plan, the estate must go through probate. This is a public, court-supervised process that can take months or even years to complete. In many states, probate costs are significant, and can consume as much as 4% to 10% of the estate’s value. Although, here in Michigan, we are not subject to the kind of fee structures other states have, going through this process still carries significant cost and is a time consuming process that uses funds that could have gone to your heirs.
4. Minor Children Are Left Vulnerable
If you have minor children and no guardianship plan, a judge - not you - will decide who raises them. Even worse, family members may fight over custody, adding trauma to an already devastating loss.
5. No Plan for Incapacity
Estate planning isn’t just about death. If you become incapacitated due to illness or injury, and you haven’t designated a power of attorney or healthcare proxy, your family may need to go to court to manage your affairs. This is expensive and time consuming and there is even the potential that the court could appoint a person that you may not even trust.
In the end, estate planning is an act of love and responsibility.
Failing to create a plan is, in effect, a plan to burden your family. Paying attention to this vital undertaking is not just about legal documents; it’s about making important choices, with far ranging effects, before others have to make them for you.
You don’t need to be rich or old to create a plan. Start with a simple will, powers of attorney, and a healthcare directive. Then, as your life evolves, revisit and refine your plan. Your family will thank you, not just for what you leave behind, but for how you spared them the confusion and conflict that so often follows in the absence of a plan.
If you need help finding the right attorney to get this important job accomplished, feel free to reach out. We work with several highly qualified, personable, and experienced attorneys that we can enthusiastically recommend. As always, we receive no compensation from any of these professionals so you can feel good that we are giving you our best counsel on who could help you best.
We are so appreciative of your business and referrals. If you are aware of anyone who is taking on the responsibility of acting as a loved one’s power-of-attorney, settling an estate or winding up a trust, please have them talk to us! There is so much that is critical to know and the personal liability that a person in these roles unknowingly assumes, is often staggering. We want to make sure that everyone we know is able to avoid the pitfalls that accompany them. Our best to you all!
Kevin and Scott