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Estate Planning

What do I need an estate plan for? I’m not wealthy

It’s true that an estate plan can help maximize the value of the assets you leave behind, but there are many more potential problems that a good estate plan will address. If you died, who will take care of your kids? What will happen to your assets or your business? If you are alive but incapacitated, who will manage your affairs for you? Who will decide what kind of medical treatment you receive? If you don’t have an estate plan, the answers to these questions aren’t clear, which can lead to unnecessary court proceedings and fighting amongst your loved ones. Furthermore, the answers that are ultimately reached might be very different from what you want. A good estate plan provides clear answers to all of these questions and more. Everyone can benefit from estate planning because everyone will eventually reach the end of their life, and everyone wants these important matters to be handled the right way, for their own sake and that of their loved ones.

Every good estate plan starts with three documents: a Last Will and Testament (LWT), a Durable Power of Attorney (POA), and a Health Care Proxy with Living Will (HCP). For many people, this is all they need. Some people benefit from additional documents as well.

Last Will and Testament

Your LWT, commonly referred to as the “will,” sets forth what happens to your assets after you pass away. In its most basic form, it names an executor/executrix who is the person who will be responsible for seeing that the LWT is administered properly, and it provides guidance as to how to administer your estate and who should receive your assets. Some commonly used optional provisions include specific bequests (giving certain items to certain people), reservation of life use of an asset for someone else, and provisions that address how to provide for children or other beneficiaries who are minors. Your LWT can be as simple or complicated as you choose, and it should be tailored by an attorney to fit your needs and effectuate your desires. Your LWT does not take effect until you pass away, and can be changed at any time, so long as you still have testamentary capacity.

Durable Power of Attorney

Your POA authorizes another person(s) to make financial decisions on your behalf. This can be a vitally important document to have if, later in life, you find yourself experiencing a mental decline that makes it difficult or impossible to manage your own finances. The POA determines who can help you and proves to financial institutions that the person(s) you chose is authorized. This is a highly customizable document, and it should be prepared by an estate planning attorney to ensure it suits your needs and wishes. The person(s) you appoint is obligated to seek out and abide by your direction (if you are able to provide direction), and to act in your best interest (not their own or anyone else’s). Your POA is in effect only while you are still alive, and can be revoked at any time, so long as you still have capacity to do so.

Health Care Proxy with Living Will

Your HCP authorizes another person to make medical decisions on your behalf. This functions much like the POA, but in addressing health care rather than financial matters. For the same reasons, it can be a vitally important document if you experience a mental decline later in life. This is also a highly customizable document, and likewise should be prepared with the assistance of an estate planning attorney so that it protects your preferences in regard to your medical treatment. Your HCP can be revoked at any time, so long as you still have capacity to do so.

Trusts

The most common addition to an estate plan is a trust. Trusts come in many forms and serve many purposes. You may need to plan for children or other beneficiaries who may still be minors when you pass away, and thus not yet mature enough to inherit. You may need to plan for beneficiaries who have special needs and governmental benefits they rely upon, so that their inheritance doesn’t disrupt such benefits. You may need to plan for assets that cannot wait to be transferred through the estate probate process, or you may need to plan for a Medicaid application to help cover end-of-life expenses. If you think a trust might be beneficial to your estate plan, you should discuss the idea with an estate planning attorney who can counsel you about how to best achieve your goals for your estate.

Estate Planning Creates Peace of Mind

Many people are hesitant to make an estate plan because they are concerned it will be a dark process. Estate planning can be a positive experience, however, if approached from the right perspective. Having a well-crafted estate plan gives you the peace of mind that your wishes will be carried out when the time comes. It also shows the people who you hold most dear that you care about them and took action to make things a little bit easier during what will be a very difficult time for your loved ones. They won’t need to wonder or argue about whether they’re doing the right thing because they will know what you wanted. If you are ready to create your estate plan, call McLaud Law P.C. for a free consultation on how we can build the right estate plan for you.
This communication is Attorney Advertising. It is presented for informational purposes only and does not constitute legal advice. Every legal situation is different, and prior results do not guarantee a similar outcome. This communication does not create an attorney-client relationship between McLaud Law P.C. and the recipient.