Sure, an estate plan may include a last will and testament or a trust, but it is so much more than just preparing legal documents. Estate planning includes anything from appointing guardians for minor children, appointing agents/helpers for health care and financial decisions, and implementing ways to protect and transfer assets, both during your lifetime and upon passing.
An estate plan includes the documents that address your specific needs, and no two estate plans look alike. Each person’s estate plan depends on any number of factors, including the complexity of your assets, the makeup of your family, as well as on your desires for final distribution to any number of beneficiaries.
It may involve some or all of the following:
Living will/Advanced Directive – This document states that you don’t want medical heroics to be kept alive if you are in an irreversible coma or vegetative state, but that you want to be kept as comfortable as possible at the end of life. The living will is considered an advanced medical directive because you’re the one making the medical decision in advance instead of your agent.
Health Care Power of Attorney – This document empowers your agent to make healthcare decisions on your behalf if you are unable to make those decisions yourself.
Durable/Financial Power of Attorney – This document appoints your agent to make financial decisions, manage bank accounts, process bill payments, and essentially step into your shoes for any and all financial decision-making or financial transactions.
Last Will and Testament – A will states how assets (that are in an individual’s name upon death) are distributed. It can appoint guardians for minor children, provide specific powers to executors/fiduciaries, and serve many other important purposes.
Trust Agreement – Trusts may offer several advantages for estate planning, including avoiding probate, maintaining privacy, and possibly providing asset protection. However, trusts are not necessary for everyone and a discussion on this point is needed for any estate plan.
Deeds/Beneficiary Designations on Real Estate – Preparing various deeds can often be part of an estate plan, both deeds during lifetime as well as transfer on death designation affidavits to transfer real estate upon passing.
Beneficiary designations are an important part of your estate plan. Keep in mind, beneficiary designations supersede what you might say in your Will or Trust. It is important to make sure that your estate planning wishes/directives do not conflict with the way you have titled your assets. SK Law can help ensure that these techniques work together to effectuate your wishes.
Your estate includes all the assets that you own at the time of your death. This may include but is not limited to:
- Your home
- Vacation/investment property
- Personal belongings (jewelry, vehicles, furniture, artwork, etc.)
- Bank accounts
- Retirement accounts
- Investment Accounts
- Business interests
- Annuities or life insurance policies and other death benefits
- Digital assets
Everyone benefits from having an estate plan in place, no matter their age or level of income or assets.
You’re never too young for an estate plan. Anyone eighteen years of age or older can, and should, have an estate plan in place.
- Take an inventory of what you own (i.e. make a list of your assets; real estate, bank accounts, vehicles, digital assets, stocks, bonds, etc.)
- Confirm any current ownership of your accounts as well as current beneficiaries you may have listed (i.e. retirement accounts and life insurance policies)
- Compile copies of any documents that you may have on file (i.e. real estate deeds, car titles, bank account/investment account statements, etc.)
- Compile any current documents that you may have in place, (i.e. wills, powers of attorney, etc)
- Gather address and phone information for those people that you may intend to name in your documents
Probate administration is the legal process of transferring the property or ownership of assets from a deceased person to their heirs or beneficiaries. The process is carried out in the Probate Court in the county in which the deceased person lived at the time of their passing.
While the process can seem cumbersome at times, it assures that the assets of a decedent are properly administered so that the wishes of the deceased loved one are carried out appropriately. In fact, oftentimes any difficulties encountered in the probate administration are a result of poor planning (or lack of planning) of a given individual during lifetime.
The Probate Court serves an important role in assisting families and beneficiaries during times of uncertainty. Attorneys play a vital role in ensuring that the rules of the probate process are followed to assist executors/fiduciaries in fulfilling their duties and following the wishes of the decedent.
While estates are often administered under the supervision of the Probate Court, many estates are addressed outside of the Court either by way of transfer on death (“TOD”) beneficiary designations, payable on death (“POD”) beneficiary designations, trust agreements, or some combination of them all. Generally speaking, while a Will provides instructions for distributing a decedent’s estate, the Will may not need to be used if all of the decedent’s assets are addressed by these alternative mechanisms.
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