What is Estate Planning?
Estate planning is the process of using professional advisors who are familiar with your goals, concerns and assets to organize your estate. Estate planning covers the transfer of property at death as well as a variety of personal matters including, but not limited to: - Health care directions
- Choosing beneficiaries
- Organ donations
- Care of minor children
- Power of attorney
- Funeral arrangements
The principal document that is most often associated with this process is your will.
Choosing the Right Estate Plan
The following is a general guide to possible estate plans for individuals in different stages of life: - 25 years old and single ¿ Unless you are unusually wealthy or ill, estate planning should not be necessary.
- Not married and have a life partner ¿ If you are unmarried and have a life partner, a will is an absolute necessity. Without a will, state law dictates how your property will be distributed after death, leaving your unmarried partner with nothing.
- Couples with young children ¿ Couples who have young children should write a will that provides for both the disposition of property to their kids as well as a legal guardian. Life insurance is another effective means of financially supporting your children.
- Middle-aged ¿ If you are middle aged and have accumulated a reasonable amount of assets, your estate plan should seek to avoid probate at all costs. Doing so, will spare your family the exorbitant time and money associated with the probate process. Creating a revocable trust or converting your bank accounts to "payable on death" are highly effective ways of achieving this.
- Elderly or ill ¿ This is the most crucial time in which to create an estate plan. Attempt to create an estate plan that avoids or minimizes the high costs of probate and estate taxes. It may also be wise to create a durable power of attorney on your behalf. Selecting a personal representative you can trust to make health care and financial decisions for you if you become incapacitated is a significant step toward planning for your estate.
Do I Need an Estate Planning Attorney?
Consultation with an attorney experienced in estate planning is essential to crafting an estate plan that is sensitive to both your needs and those of your loved ones. A lawyer will know which type of will or trust is right for you, and do their best to limit your tax liability. |
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