Estate Planning Lawyer
As an estate planning lawyer can attest, estate planning is not a tool only applicable to those with excessive wealth. Estate planning is a crucial step that should be taken to manage a person’s wealth and ensure that a person’s wishes are carried out and loved ones receive the inheritance they are entitled to. The following are essential estate planning tools that our team from Kaplan Law Practice, LLC recommends people consider when preparing for the future:
The Last Will and Testament
When a person considers estate planning, the will is likely to be the first tool that is considered. The will is a legal document that outlines how the testator wants to distribute their assets after passing. Within the will, the testator can appoint an executor, name guardians for minor children, and specify beneficiaries for assets. Despite its importance, many people must pay more attention to this crucial step. With a valid will, the state will distribute your assets according to intestacy laws, which may align with your wishes.
Trusts
Trusts are an advanced tool that may be accessed during estate planning.
A trust can distribute your assets after death and manage them during your lifetime if you become incapacitated. Trusts can help avoid probate, provide tax advantages, and protect your privacy since they’re not public records. Living, testamentary, and special needs trusts are just a few types of trusts to consider.
Durable Power of Attorney (POA)
A durable power of attorney is when a person appoints someone to make financial decisions for them when they can no longer do so. The designated agent can handle tasks like paying bills, managing investments, and selling property. If you become incapacitated without a POA, your family may have to go through a court process to get permission to handle your affairs.
Healthcare Power of Attorney and Living Will
Sometimes, a person may become incapacitated and unable to make medical decisions independently. A healthcare power of attorney can be appointed to step in and make critical healthcare decisions. A living will, also known as an advance healthcare directive, states your wishes regarding end-of-life care. These documents can guide loved ones and healthcare providers during a crisis.
Beneficiary Designations
Beneficiary designations are critical to the estate planning process. Unfortunately, when overlooked, it can be highly problematic after a person passes. Many assets, including life insurance policies, retirement accounts, and some bank accounts, allow you to name a beneficiary who will directly inherit these assets without going through probate. It’s essential to keep these designations updated, especially after significant life events like marriage, divorce, or the birth of a child.
Letter of Intent
A letter of intent provides additional instructions and wishes that can be clearly outlined within legal documents. The letter of intent covers personal aspects such as funeral arrangements and personal messages to loved ones.
Developing an estate plan is not a one size fits all process, as each person has unique needs that must be considered. What works for one person may not work for another. Consulting with an experienced estate planning lawyer can provide invaluable guidance and peace of mind. Remember, estate planning is not a one-time event but an ongoing process that should be revisited and updated as your life changes. Using these critical tools allows you to take charge of your legacy and provide for your loved ones’ future.