Your family can be as involved in your estate planning as you’d like, depending on how close they are to you and how they figure into the plan. It’s important for those who are named in the documents to be made aware. If you want certain family members or friends to have power of attorney or be successor trustees or executors, discuss those roles with them so they understand what their duties would be. Some people do not feel equipped to deal with these tasks and will decline; it’s better to be aware of this ahead of time so you can find alternate options. You also need to choose alternate options for these roles in case someone predeceases you.
Equally important is making family members or loved ones aware of the estate plan’s existence. They will need to know where the documents are located, how to access them, and who to contact for help, such as the estate planning attorney who prepared the documents.
In the end, your estate plan is to not only set your own mind at ease but provide a smooth transition for your loved ones after your death. If keeping them in the loop while you make the estate plan will make that transition even easier, involve them.
Irrevocable trusts are unchangeable once they’re put into place. The assets and property placed in the trust permanently belong to the trust and can’t be used or removed by the trustees. Once the terms of the trust are met, the assets are used or distributed to named beneficiaries.
By contrast, a revocable trust is changeable while you’re still living, and therefore makes an ideal estate planning document for protecting assets while still allowing you to make tweaks as your life changes. You can transfer property in and out of the trust, change beneficiaries and successor trustees, and use the assets throughout your lifetime. Upon your death, the revocable trust immediately becomes irrevocable.
Power of attorney is a document empowering another individual to make decisions on your behalf. For example, someone can be given power of attorney to make a business decision on a person’s behalf if that person couldn’t attend an important meeting. In the context of estate planning, the most common power of attorney is a durable power of attorney. This means the document remains effective for an individual if s/he is incapacitated. You can have separate medical and financial power of attorney documents, naming one person to act on your behalf for medical decisions and another person for financial decisions.
A living will works in conjunction with a power of attorney by expressing your wishes should you be incapacitated or in a vegetative state. The living will can ensure your wishes for your medical care are followed, but since you don’t know if or what may happen to you, any additional decisions can be left up to the trusted individual named in your medical power of attorney. Likewise, the individual given financial power of attorney can act on your behalf in that capacity while you’re unable to perform those actions.
Yes, you can; holographic (handwritten) wills are honored in Arizona, provided they are clearly written and signed. However, such wills are more at risk to being contested by family members and may require verification that the handwriting is authentic. Moreover, misconceptions about a will’s powers could lead to requests being placed in the document that can’t be carried out, such as end-of-life care or naming beneficiaries for insurance policies or pensions. Even funeral instructions may not be heeded if the will isn’t found until after those decisions have already been made. Even more problematic, family members might not realize you have a will, or may not know where to look; a will is no good if no one knows about it.
By consulting a lawyer, you can ensure everything in your will is legally enforceable. Your attorney will also be able to make sure your wishes are followed, and can help testify to the document’s legitimacy. Furthermore, you can provide instructions for additional aspects of your estate using other avenues, like trusts or power of attorney documents. Your loved ones can also avoid having to pay some taxes by employing other planning strategies. Contact an estate planning lawyer at Bellah Perez if you have any questions.
Probate is a loaded word in estate planning, but it’s simply the court process that determines a will is legitimate and sets in motion the executor’s ability to take inventory of the estate, pay debts and taxes, and then distribute the remaining assets. The reason it’s often desirable to avoid probate is because the process can be lengthy and result in additional costs, not to mention it makes everything a matter of public record.
Avoiding probate can help certain property and assets go directly to named beneficiaries, essentially cutting out the middle man. By doing so, it can also save you money on taxes. In short, avoiding probate means less time and money invested before beneficiaries receive their inheritances. The seasoned estate planning attorneys at Bellah Perez, PLLC are experienced with probate issues, and can minimize the amount of property passing through the process.
Do you own anything? Then you need an estate plan. If you have any assets to your name, even minor ones, it’s wise to have some documentation in place to determine where those assets will go in the event of your death. Not everyone needs a complicated trust set up, but a last will and testament can still make sure your niece gets that family heirloom or your cousin gets first dibs on your comic book collection.
Do you have wishes regarding how you want to be cared for in the event of a terminal illness or incapacitation? Then you also need estate planning aid. Power of attorney documents and living wills dictate how you want to be treated when you can’t speak up, at your funeral, and after you’re gone.
Despite the term conjuring images of someone out of Downton Abbey with a sprawling mansion and corresponding staff, your “estate” is simply what you own, whether that’s your home, your car, your insurance policies, your pets, your antique spoon collection… all of these assets count as your estate. Without a plan for what to do with these assets, your loved ones will have to decide who gets what, guess at your wishes for your end-of-life care and funeral arrangements, and scramble to pay debts and taxes. Estate planning is peace of mind, for you and your loved ones, so that when the time comes, everything is already taken care of. The house passes to your named beneficiaries, the car is sold, the pet goes to a beloved friend, and that antique spoon collection is donated to a museum — exactly as you wished.
Moreover, estate planning includes documentation for your health and financial welfare in the event of an accident that leaves you unable to make decisions for yourself. Documents like power of attorney and living wills ensure your wishes are followed even when you aren’t capable of voicing them.
Many people mistakenly think that estate planning involves only the drafting of a last will and testament. However, estate planning involves financial, business, tax, and medical planning. Estate planning can help you determine:
- How and by whom your assets will be managed for your benefit during your lifetime if you ever become unable to manage yourself or your affairs.
- When and under what circumstances it makes sense to distribute your assets during your lifetime.
- How and to whom your assets will be distributed after your death.
- How and by whom your personal care will be managed and how health care decisions will be made during your lifetime if you become unable to care for yourself.