Although it can be uncomfortable to think of your own mortality, it is important to explore estate planning early in life. Many people wait until they reach an advanced age, or are seriously ill, to begin thinking about their estate plans. This leaves your family and loved ones in a state of insecurity. It can cause serious issues for them after you pass.
Unfortunately, estate planning often feels confusing, and many people do not know where to begin. However, with the help of an expert estate planning attorney, you can navigate the process with ease.
Regardless of your situation, there are key concepts and terms that are important to know. These can help make your estate planning more effective and allow you to make empowered decisions about your family’s future.
- Executor of the Will
Wills are the most common type of estate planning tool, and most people understand the basics of what a will includes. When you make a will, you will name an executor. This is the person who will carry out your wishes. In many cases, such as if circumstances have changed or someone included in your will has died, an executor needs to make informed decisions on your behalf. Therefore, an executor should be someone who knows and understands you very well.
- Probate
The probate court affects most estates at some point. Probate is the judicial process that the state uses to settle a deceased person’s tax debts before moving the assets on to their family.
During this process, the court also looks at the deceased’s will to make sure that it is valid. If it is not, or if there is no will, the probate court will decide who gets the deceased’s assets. Generally, all assets move to the next of kin in these situations.
If the will is valid, the assets will go to the executor so that they can distribute assets to the beneficiaries.
- Trust
Trusts are a fantastic estate planning tool, especially if you have significant assets. When a person puts their assets into a trust, they basically transfer official ownership from themselves to the trustee. This trustee will “hold” the assets until the trust owner, or trustor, dies. Then, the trustee will distribute the assets in the trust.
Many assets that are held in a trust bypass probate court. This is because a trustee “owns” the property in the eyes of the law. Since the trustee does not pass away, there is no need for the assets to go through probate court. This often saves families significant money on fees and taxes.
- Power of Attorney
As part of the estate planning process, many people name powers of attorney. These are individuals who are authorized to make key decisions on your behalf if you are unable to do so yourself.
If you become incapacitated, some powers of attorney gain permanent and broad authority. Others have specific tasks, such as making healthcare decisions. You can even name a power of attorney if you are leaving the country. You can give someone else a temporary power of attorney while you are away. They can then sign documents or make decisions about your assets in an emergency.
Powers of attorney are important to the estate planning process, but it is important to choose wisely. A power of attorney should be someone you trust deeply.
- Intestate
When an individual dies without a will, they die intestate. This means that the state has authority over what will happen to the deceased’s assets. Usually, the probate court takes the appropriate taxes and fees. The rest of the assets will then go to the deceased’s next of kin.
The threat of an intestate death should prompt you to create an estate plan. Intestate deaths cause significant problems for the deceased’s family.
FAQs
Q: When Should I Create an Estate Plan?
A: Create your estate plan as soon as possible. Generally, you should have at least a will as soon as you acquire significant assets or have children. Estate planning tools are helpful for families of various income levels and ages. Do not assume that estate plans are for the elderly and wealthy. Most families can benefit from some sort of estate planning support.
Q: I Disagree With a Trustee’s Decisions. What Do I Do?
A: If you are a beneficiary in a trust and the trustee makes a decision with which you disagree, you can bring a claim in court with the help of an attorney. This process may take months or years, but the court may ultimately be able to resolve your issue. However, you can only file these claims if you have a real and vested interest in the trust’s outcome. If you are not a beneficiary, the court will deny your request.
Q: Why Is a Will Important?
A: If you die without a will, the court will transfer all your assets to your next of kin. This can be problematic if you have several loved ones that you wish to inherit. For example, if you have biological children from one marriage and then remarry, all your assets would go to your second spouse when you die. If they wish, they could leave the assets to their own children, leaving your kids with nothing.
Q: Do I Need an Estate Planning Lawyer?
A: Estate planning is complicated, and it is easy to do it incorrectly. If you do it yourself and the documents are not legitimate, the court will have to act as if you died intestate. They will then make executive decisions about what will happen to your assets. To avoid this, you need to ensure that all estate planning documents are crafted and approved by a professional. An attorney is the best choice.
Contact Stange Law Firm
Our team at Stange Law Firm offers expert estate planning services for families of all kinds. No matter your situation, we can create an estate plan that works for you.
To learn more, or to get started, contact Stange Law Firm online today.
