According to studies, the vast majority of Americans in Minnesota and around the nation do not have a will in place. An estate plan may seem like something only the very wealthy with large estates must have, but that is not always the case. A will is an extremely important document to create, especially if you’re a small business owner. The following includes detailed information on the disadvantages of not having a will as well as the benefits that come with it.
What happens if no will is created?
If there is no will in place at the time of your passing, the state in which you reside will enact its own procedures as to what happens to your assets. In terms of a business, the state will likely hand it over to your spouse, children or grandchildren. However, most business owners want someone who is going to continue their company’s legacy, and an inexperienced grandchild may not be the best person for the job. A will may provide you the opportunity to determine who gets a portion of your business and how it operates moving forward.
Inter-family legal fights
One of the reasons that a business owner needs a will in place is due to the safeguards it places for the family. Passing on without going through the estate planning process can cause a lot of inter-family fighting and may lead to a long and costly probate process. This means that your family members might not have complete control of your business until years after your passing. A prolonged probate process could harm not only your company’s financial standing but also your family’s relationships.
As you can see, there are a number of reasons why a business owner must create a will. You must first make sure to consult with an attorney as there are plenty of legal obstacles that can invalidate your will if it’s not written properly.