Estate Planning

The Issues

Estate planning means much more than preparing a Last Will and Testament or tax planning for the disposition of your assets upon your death. Estate planning is the process of accumulating and disposing of an estate to maximize the goals of the estate owner. The goals of estate planning typically include making sure the greatest amount of the estate passes to intended beneficiaries, often including minimizing the amount of taxes due. Estate planning must also provide for administration and protection of assets during lifetime and for decision making in the event of a disabling illness.
Any complete estate plan should contain:

  1. A Last Will and Testament
  2. A durable health care power of attorney naming an agent (and an alternate agent) responsible for medical decision-making
  3. A living will or other advance directive giving instructions concerning the type of care one wishes to receive (or avoid) in the event of a terminal illness or persistent vegetative state, and
  4. A durable financial power of attorney naming an agent (and an alternate) responsible for asset and financial management if one is unable to do such things for oneself.

Estate planning may also include the creation of trusts.
Estate planning is an opportunity to make wishes known about your health care and asset distribution and to determine what person(s) will be responsible for carrying out those directives. You are able to state your preferences concerning the type of care you receive, what types of medical care you do not wish to receive and who you wish to act as your agent in carrying out those wishes. Should you fail to do such planning, then there may be confusion as to what your wishes might have been and who you would have preferred to act as your decision-maker. In fact, without such information, your wishes may never be known. If you do not leave a Last Will and Testament or trust, your assets will be distributed according to the laws of intestate (no will) succession in your state. There are laws in each state governing the rights of surviving spouses, heirs and next of kin in the absence of a Last Will and Testament.

What You Need To Know

In preparing an estate plan, it is essential that all of your assets are considered. You should do a complete inventory of all that you own before contacting your estate planner. Your estate consists not only of your home, your car and your bank accounts. Your estate also includes the value of life insurance policies, annuities contracts, investments that you may own (including those held in joint tenancy with other persons), your IRAs and other retirement accounts, and any other assets over which you can exercise control.
It is extremely helpful for you to have a centralized and secured record of all of your financial accounts, insurance policies, credit, debit cards, or loan accounts, safe deposit box, and account IDs and passwords.
You will need to make decisions about what to include in your estate plan. First, you will need to list any specific gifts you want to make to family or non-family members and/or to charities. You should determine who will inherit your property upon your death. You must also be certain that your spouse or heirs are capable of managing financial affairs after you. If capacity or vulnerability is an issue, you may want to name a trustee to handle financial affairs for him or her. You must designate an Executor or Personal Representative to administer your estate, as well as an alternate for this role. Special arrangements may be needed if there are particular family issues, such as children from a previous marriage of either spouse.
Once these decisions are made and your inventory is completed, your attorney will be able to advise you as to the best technique to use in planning your estate. In the event of a disability, you should decide who will be your decision-makers with respect to your finances and your health care options. Finally, you should give thought to the difficult questions of what type of care you would want or not want in the event of terminal illness. If you have special desires concerning disposition of your remains, such as burial in a certain place or possible cremation, these should be brought up during your planning conference as well.
These are complicated and personal issues. The advice of a qualified Elder Law attorney is essential to protect your financial health and welfare and to insure that your health care wishes are known and carried out.

Where To Go For Help

Some insurance vendors call themselves estate planners as do some accountants and some financial planners. Often, these individuals will be selling some type of product or service. Use caution in attending free seminars about living trusts or other arrangements since such programs often will sell you documents that you do not need or advocate a plan that does not actually provide the type of benefits claimed. Be careful to note that this area of the law is constantly changing and books or materials on the internet are not always up to date. While there are pre-printed forms readily available for wills, powers of attorney, living trusts and living wills, such forms may not be valid in your state or may not meet your specific needs. Completing such forms properly can be difficult, and you cannot correct your mistakes when you are dead or disabled.