What is Estate Planning?
Estate planning is the process of preparing documents that answer these questions:
- Who do I wish to make financial, legal, and medical decisions for me in the case that I cannot?
- What happens to my assets when I die?
- What kind of end of life medical decisions do I want to make now. These instructions can be followed by your family later.
What are the words I need to know?
Estate: A collection of your stuff. You may have several estates. That is your stuff can be organized into different collections.
Executor: The person responsible for wrapping up your affairs. Usually called a personal representative in modern law.
Intestate: Died without a will
Probate: The process of either admitting a will and distributing your stuff or if there is no will, opening administration and distributing your stuff and settling your debts.
Testate: Died with a will
Trust: Placing assets in the care of a third person (sometimes yourself) who will manage those assets for the benefit of another person.
What are the steps to planning?
- Answer these questions
- Who do I want to make financial decisions for me if I was in a coma?
- Who do I want to make medical decisions for me if I was in a coma?
- Who do I want to make legal decisions for me if I was in a coma?
- What are my final end-of-life medical decisions?
- Who do I want to implement my end-of-life decisions?
- Who gets my stuff when I die?
- Just Get It Done
- It is highly suggested that you seek the advice of a professional estate planning attorney.
- It is easy to mess this process up on your own. A missed signature or failure to get the proper witnesses can invalidate the entire document.
- Review The Plan
- Every 5 years
- Every major life event
- Birth of a child
- Death of a spouse
What documents do I need and what do they mean?
Will: A document that gives your instructions as to how to distribute your estate after your death. A will must be admitted to probate. Probate can take 6 months or more before anything is distributed.
Living Will: This is a confusing name for a document… A living will has nothing to do with a will. This is your end-of-life instructions. You make decisions about your healthcare now.
Durable Power of Attorney: You decide now who can make legal and financial decisions for you.
Medical Power of Attorney: You decide now who can make medical decisions for you.
HIPAA Waiver: You need to allow your Medical Power of Attorney the right to view your medical records.
Nomination of Guardian: If you have children under the age of 18, then you need to pick somebody to raise your children.
Trust: A trust is a way to avoid probate and protect assets in the case of a second marriage.
What Documents do I need to Find to Create My Plan?
- All of your account statements and agreements
- The deeds to all of your real estate
- A list of people your trust to make decisions for you
- Information about any companies you own any or a part of
- Titles to all vehicles
- All life insurance policies