April is National Financial Literacy Month, and there’s no better time to ask yourself: Is my financial house in order? While most people think financial literacy is just about budgeting and saving, true financial well-being also includes the legal safeguards protecting everything you’ve worked hard to build.
At Debranski & Associates, LLC, we believe that informed decisions are empowered decisions. That’s why we take the time to answer the essential questions that help our clients protect their families, their businesses, and their futures.
This month, we’re sharing answers to the most common legal questions we hear from clients who are ready to get serious about their financial planning.
1. Do I really need an estate plan if I’m not wealthy?
Absolutely. Estate planning isn’t just for the ultra-wealthy—it’s for anyone who wants to have a say in what happens to their assets, children, or health decisions if they become incapacitated or pass away. Without an estate plan, your assets could be distributed according to state laws, your children’s guardianship could be decided by the court, and your health decisions could be made by someone you may not have chosen.
A comprehensive estate plan includes more than just a will. It can also include:
- Powers of attorney for healthcare and finances
- Living wills or advance directives
- Revocable or irrevocable trusts
- Guardianship designations for minor children
By having an estate plan in place, you not only relieve your loved ones of the burden of making difficult decisions during an already emotional time, but you also ensure that your wishes are carried out, not left up to the court. This brings a sense of relief and peace of mind, knowing that your affairs are in order.
2. What’s the difference between a will and a trust?
This is a question we get almost daily. A will is a legal document that outlines your wishes after you pass away—it goes through probate and becomes part of the public record. On the other hand, a trust is a legal entity that holds your assets and allows them to pass to your beneficiaries outside of probate.
Trusts can offer:
- Greater privacy
- Faster distribution of assets
- Potential tax advantages
- Protection for beneficiaries who may not be ready to manage an inheritance
Not everyone needs a trust, but for many of our clients—especially business owners or families with complex assets—a trust can be a vital piece of the estate planning puzzle.
3. How can I protect my small business legally and financially?
If you own a business, your personal and professional finances are closely linked—and both need protection. We work with small business owners to:
- Form LLCs or corporations for liability protection
- Draft solid operating agreements and bylaws
- Create buy-sell agreements
- Establish succession plans
- Review contracts and vendor agreements
One of the best ways to increase financial literacy as a business owner is to understand how to separate your personal and business assets, and how to create a legal foundation that grows with you. This understanding empowers you, giving you the confidence and control over your business’s legal and financial aspects.
4. What happens if I become incapacitated and don’t have legal documents in place?
Without legal documents such as a durable power of attorney or health care directive, your family could be forced to go to court to make decisions on your behalf. This process—called guardianship or conservatorship—can be costly, time-consuming, and emotionally draining.
Having these documents in place now ensures that someone you trust can act on your behalf if you cannot make decisions for yourself, whether due to illness, injury, or age-related concerns.
5. How can I ensure my children are cared for if something happens to me?
One of the most heartbreaking situations we see is when parents pass away or become incapacitated without naming a legal guardian for their minor children. In these cases, the court steps in to decide—and that decision may not reflect your wishes.
Part of a good estate plan includes naming a guardian and a trustee—the guardian raises your children, and the trustee manages the finances you leave behind for them. In some cases, they can be the same person; in others, it makes sense to separate those responsibilities.
6. What legal steps can I take to protect my assets from creditors or lawsuits?
Depending on your unique financial picture, there are several legal strategies to protect your assets. These may include:
- Establishing certain types of trusts (like irrevocable trusts)
- Properly structuring your business entity
- Using insurance as a shield
- Retitling assets strategically
These tools aren’t one-size-fits-all, and we encourage clients to have a personalized asset protection strategy in place long before any legal issues arise. A personalized strategy takes into account your unique financial situation and goals, providing a more effective shield against potential legal issues.
7. How often should I review my legal documents?
Life changes—and your legal documents should, too. We recommend reviewing your estate plan and business documents:
- After major life events (marriage, divorce, birth of a child, death of a loved one)
- Every 3–5 years, as a general rule
- Anytime your financial circumstances change significantly
A quick review can help avoid significant problems down the road, and we offer consultations to help ensure everything is still aligned with your current goals. Regular review of your legal documents is a proactive and responsible step towards ensuring your financial and legal well-being.
Your Financial Future Deserves Legal Protection
At Debranski & Associates, LLC, we believe that good legal planning goes hand-in-hand with good financial planning. Whether you’re just starting your journey or revisiting your existing documents, we’re here to walk you through your options with clarity and compassion.
When it comes to getting your legal affairs in order and protecting what matters most, it’s never too late. Reach out to schedule a consultation with our team today to get started.
Let’s ensure that your financial future is as secure as it is successful.