Estate Planning is a Personal Process

Estate planning requires us to do something today that hasn’t happened yet.

Without a plan, your loved ones will be forced to guess your intentions against the backdrop of an already difficult situation. Even if potential heirs are on good terms, money has a way of creating divisions.

Key takeaways

• Common estate planning documents include wills, trusts, powers of attorney, and living wills.
• Everyone can benefit from having a will, no matter how small their estate.
• Online estate planning services offer basic packages for less than $200 (more in a moment).
• Estate planning attorneys can cost several hundred dollars per hour.
• Estate plans must be updated after significant life events.

What is a will? It is a legal document stating how you want your executor (the person legally obligated to administer your estate) to distribute your assets after you die.

Your estate will go through probate, the legal process for reviewing the assets of a deceased person and determining who inherits what, whether you have a will or not.

If you have a will, it ensures the executor will honor your wishes.

A will lists your assets, bank and brokerage accounts, property, and more. Without a detailed document, potential heirs may be forced to search for assets spread across states and even countries.

Do you have designated beneficiaries for various accounts, such as IRAs? The beneficiary designation trumps the will.

What is a living will? It is written, legal instructions stating your preferences for medical care if you are unable to make decisions.

What is a trust? A trust is a legal contract that allows another person (the trustee) to hold property for you (the grantor).

This is typically so the beneficiaries (individuals or institutions who stand to inherit something) can use the property at some point in the future.

What is a living trust? You create a living trust to hold assets before and after your death.

What is a testamentary trust? It is a trust created by the will and only becomes effective after the grantor’s death.

Powers of attorney

A durable power of attorney enables your agent to act on your behalf if you become ill or are unable to make decisions.

For example, a durable financial power of attorney allows your agent to manage your financial affairs if you become incapacitated or are unable to make decisions on your own.

A durable medical power of attorney allows you to appoint someone to make decisions about life-prolonging care, treatment, services and procedures.

Prepare your heirs

You don’t have to divulge the details, but informing beneficiaries opens the financial lines of communication, reducing the odds of a contested will. In addition, it promotes family unity at a time that can be exceedingly difficult.

Surprises breed resentment, and resentment may lead to unwanted consequences.

We recognize that estate planning is a personal process. In some cases, you may feel overwhelmed, especially if you have a large family, a blended family, or a family that has gone through separations and divorce.

Our objective is to initiate a dialogue, assist you in developing a plan, or motivate you to revise an existing one if the need has arisen.

We are always available to address any questions you may have.

This information is not intended to be a substitute for individualized legal advice. Please consult your legal advisor regarding your specific situation.