Estate planning includes much more than drafting a will. It encompasses titling assets, naming beneficiaries, and creating trust documents. It also involves naming someone to make financial and medical decisions on your behalf (power of attorney), as well as describing your wishes if you become incapacitated.
It’s a big job, but it’s something everyone should do. With a little effort, you can avoid the big delays and costs that can come with probate.
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Know What You Own
Many assets are more than just money, such as physical objects of personal and family value like heirlooms, hobby collections, or memorabilia. In addition, digital assets such as online banking, rewards points, or cryptocurrencies are often overlooked in estate plans.
Family dynamics change often, and it’s important that the estate planning process is reviewed on a recurring basis. Births, deaths, marriages, and divorces could revoke or alter dispositions of property; and changes in health may result in a need to rewrite advance directives for long-term care or incapacity.
It’s also essential that people have an understanding of possible types of taxes, such as probate and inheritance tax, that they might face. Adding content to your law firm’s website on these topics can help potential clients understand the scope of their planning needs and the complexities involved. The more informed a client is about these issues, the more productive their time with an attorney will be.
Decide Who Should Receive Your Assets
Unlike a simple will, an estate plan can provide detailed instructions for distributing assets to beneficiaries. It can also create trusts that facilitate specific goals, such as funding a child’s college education or caring for an elderly parent.
The process of estate planning can also help you consider your family structure and any potential tax issues that might affect the distribution of your assets. Many states have inheritance, estate, and gift taxes, which can eat into the value of your estate. A professional can guide you through the different options available to minimize those costs and ensure that your heirs receive as much of your estate as possible.
Estate planning also addresses healthcare issues, such as living wills and healthcare proxies. This can help ensure that your wishes are respected if you become incapacitated so that your loved ones don’t have to make tough decisions for you. This can be especially important if your family members live far away.
Record Your Wishes
Unless you take the time to put your wishes down in writing, family members may have to conduct a lengthy probate court proceeding to determine the validity of your will and settle your debts after your death. A good estate plan can avoid this expensive and stressful process for your family.
In addition to a will, you should also prepare documents like a power of attorney, health care proxy, and trusts. This ensures that someone you trust will manage your affairs if you become incapacitated and that your family members will receive the assets you intend them to.
Discussing your plan can feel uncomfortable, but sharing it with family members will make it easier for them to carry out your wishes and prevent squabbles over money or special family treasures. This is especially important as family dynamics change over the years. It is a good idea to communicate your plans to family members and friends, although you don’t need to share every detail at once.
Hire an Attorney
Making an estate plan for your loved ones is one of the most considerate and kind things you can do. Without a plan in place, the state determines what happens to your belongings and assets during probate, and it may not be in line with your wishes.
You need to find a good estate lawyer. The best way to do that is to ask for references and look up attorney reviews. Also, check the local, county, and state bar association websites to see who has passed the Bar exam in your area.
A good attorney will take the time to get to know you, your family, and your goals. They will also understand the current laws and how they impact your situation. In addition, an attorney will make sure that your documents are legally sound and will carry out your wishes when the time comes. They will charge either an hourly rate or a flat fee.