By: Renee A Harvey, Esquire
Decato Law Office 603-640-2020
Regardless of your net worth, it is important to have a basic estate plan in place. Estate planning ensures that the important people in your life are taken care of and your financial goals are met after you die. Now, it may be the subject matters involved – death, incapacity, probate, taxes – that causes many of us to avoid putting an estate plan in place; or it may be the uncertain economic times and the need to budget “nonessentials”. However, by making the choice to forgo an estate plan and save money, in the long run you are not really saving at all. Without a proper estate plan in place at your death, not only may your loved ones not necessarily inherit from your estate, your estate may have to pay the high costs of probate proceedings and attorney’s fees, not to mention a lengthy probate process.
How do you get started then?
A good place to begin is to take inventory of your assets. These include your real estate, insurance policies, investments and retirement savings. Then you can ask yourself three important questions: (1) Whom do you want to make financial decisions for you if you cannot make them for yourself; (2) Whom do you want to make medical decisions for you if you cannot make them for yourself; and, (3) Whom do you want to inherit your assets? By considering these in advance, your meeting with us will be more productive and expedite the planning process.
What documents are involved?
An estate plan has several components:
▸ Will. A will provides instructions for distribution of your assets upon your death. It recites family relationships, and it appoints executors, trustees and guardians to manage your assets. Most importantly, it names the beneficiaries who are to receive your real estate, cash assets and personal property.
▸ Durable Power of Attorney. A power of attorney allows you to name and authorize another person to act for you in the event that you are not capable of acting on your own behalf. This power terminates at your death, but provides you with someone who, in the event of your incapacity, has the power to step into your shoes and make financial decisions for you during your life.
▸ Health Care Power of Attorney. A health care power of attorney also allows you to name and authorize another person to make medical decisions for you in the event that you are incapacitated. This power also terminates at your death.
▸ Living Will. A living will speaks to your wishes regarding the use of life sustaining measures in the event of a terminal illness. It does not authorize another person to make decisions for you, but it expresses your wishes regarding whether you do or do not want life support. A living will, coupled with both powers of attorney documents can lessen family conflicts and avoid court intervention in the event that you are unable to make decisions on your own behalf.
▸ Revocable Trust. A living trust makes sense for some people. There are many different types of trusts that accomplish different goals. A revocable living trust can manage your financial affairs during your lifetime, during incapacity, at your death, and after your death. It is a vehicle that allows trust assets to avoid the probate process, therefore lessening the amount of time and money spent in the ultimate distribution of your assets.
You cannot buy a sound estate plan off the shelf. The quality is a direct result of your own interest, understanding and participation, along with the help of skilled advisors, because there is more to the estate planning process than just the documents. Even if you already have an estate plan in place, it may not be optimal and it may be time to revisit it. It will provide you with peace of mind to have a will in place and know that you have provided for those you care about.
Decato Law Office 603-640-2020
Regardless of your net worth, it is important to have a basic estate plan in place. Estate planning ensures that the important people in your life are taken care of and your financial goals are met after you die. Now, it may be the subject matters involved – death, incapacity, probate, taxes – that causes many of us to avoid putting an estate plan in place; or it may be the uncertain economic times and the need to budget “nonessentials”. However, by making the choice to forgo an estate plan and save money, in the long run you are not really saving at all. Without a proper estate plan in place at your death, not only may your loved ones not necessarily inherit from your estate, your estate may have to pay the high costs of probate proceedings and attorney’s fees, not to mention a lengthy probate process.
How do you get started then?
A good place to begin is to take inventory of your assets. These include your real estate, insurance policies, investments and retirement savings. Then you can ask yourself three important questions: (1) Whom do you want to make financial decisions for you if you cannot make them for yourself; (2) Whom do you want to make medical decisions for you if you cannot make them for yourself; and, (3) Whom do you want to inherit your assets? By considering these in advance, your meeting with us will be more productive and expedite the planning process.
What documents are involved?
An estate plan has several components:
▸ Will. A will provides instructions for distribution of your assets upon your death. It recites family relationships, and it appoints executors, trustees and guardians to manage your assets. Most importantly, it names the beneficiaries who are to receive your real estate, cash assets and personal property.
▸ Durable Power of Attorney. A power of attorney allows you to name and authorize another person to act for you in the event that you are not capable of acting on your own behalf. This power terminates at your death, but provides you with someone who, in the event of your incapacity, has the power to step into your shoes and make financial decisions for you during your life.
▸ Health Care Power of Attorney. A health care power of attorney also allows you to name and authorize another person to make medical decisions for you in the event that you are incapacitated. This power also terminates at your death.
▸ Living Will. A living will speaks to your wishes regarding the use of life sustaining measures in the event of a terminal illness. It does not authorize another person to make decisions for you, but it expresses your wishes regarding whether you do or do not want life support. A living will, coupled with both powers of attorney documents can lessen family conflicts and avoid court intervention in the event that you are unable to make decisions on your own behalf.
▸ Revocable Trust. A living trust makes sense for some people. There are many different types of trusts that accomplish different goals. A revocable living trust can manage your financial affairs during your lifetime, during incapacity, at your death, and after your death. It is a vehicle that allows trust assets to avoid the probate process, therefore lessening the amount of time and money spent in the ultimate distribution of your assets.
You cannot buy a sound estate plan off the shelf. The quality is a direct result of your own interest, understanding and participation, along with the help of skilled advisors, because there is more to the estate planning process than just the documents. Even if you already have an estate plan in place, it may not be optimal and it may be time to revisit it. It will provide you with peace of mind to have a will in place and know that you have provided for those you care about.
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