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Benefits

Estate Planning Is More Than Just Death Planning

Many believe that estate planning is simply instructions on how to distribute your assets when you pass away, but the reality is that proper estate planning can do much more. While one major benefit of estate planning is to provide for your family and friends when you are gone, there are many benefits for you as well.

Additional Benefits of Estate Planning

Life can give us surprises, both good and bad. Estate planning can help you be prepared for some unfortunate surprises in life. This is because proper estate planning includes planning for you and your care in the event you become incapacitated.

One tool used to address your care in the event of incapacity is a financial power of attorney. This legal document allows you to appoint someone to manage your finances and property on your behalf. A financial power of attorney can go into effect as soon as the document is signed, allowing someone to act on your behalf immediately, even if you are not incapacitated. Alternatively, power of attorney can be “springing,” only going into effect in the event you become incapacitated (as determined by a physician). You can determine which type of financial power of attorney fits your unique situation.

Another estate planning tool that can protect you in a time of need is a medical durable power of attorney. Also referred to as a healthcare directive, this legal document lets you name a trusted person to make medical decisions on your behalf when you are unable to do so yourself. It also allows you to lay out some of your wishes regarding your medical care.

A document called a living will also bring peace of mind to both you and your loved ones because it provides instructions on what type of end-of-life medical care you want. Sometimes referred to as an advance directive, a living will is often paired with a healthcare durable power of attorney.

Finally, the use of a revocable living trust can be beneficial in the event you become incapacitated. When you are healthy and have the capacity, you are typically the trustee of a revocable living trust, able to manage the assets and use them for your benefit. However, the trust instrument also allows you to name a successor trustee who will step into your shoes to manage the assets when you are no longer able to act due to incapacity or disability. Successor trustees also have to continue to use the assets for their benefit.

Plan Ahead for Peace of Mind

Having a properly drafted estate plan that includes the documents described above can help protect you during your lifetime. Failure to have these documents in place may result in your loved ones going before the court to have someone appointed to make financial and medical decisions for you. This process, often called “living probate,” is lengthy, expensive, and stressful – not to mention part of the public record – during a difficult time when your loved ones are already dealing with the incapacity of someone they care about – you!

If you have questions about any of these legal documents or how to protect yourself through estate planning, give us a call today! Call our office at 832.408.0505 or schedule your appointment right now to learn about your options under applicable law.

 

There’s Never A Better Time Than Now To Get Your Affairs in Order

The idea of getting your financial and legal house in order is likely the last thing on your mind during the busy holiday season.  But, getting started is much easier than you think.  In fact, the end of the year is a good time to reflect upon the year that has passed and focus on your aspirations for the future.  Don’t hold this task off for later.  Some careful thought and a little bit of work now can go a long way to help you feel 100% confident about moving forward in the new tax year.

In preparation for the tax season, you likely have already begun gathering some paperwork, like you property tax bill, year end mortgage statement, or final pay stubs.  Although filing your income taxes is different than putting your affairs in order, you’re already in paperwork “mode”, so now is the perfect time to reassess your legal and financial situation to create a new plan or update an existing one that no longer suits your circumstances.

Basic Estate Planning

All you need to do is start with a general list of everything that you own.  You don’t have to complete a comprehensive inventory.  Think instead about categories of assets, like bank accounts, life insurance, real estate, vehicles, etc.

Then, draw out your family tree and think about who you would like to receive what you’ve spent your lifetime building.  If you don’t put your wishes in writing, your estate – everything you’ve worked so hard to build – may be liquidated and will be distributed according to the government’s plan, known as intestacy.

The foundation of all estate plans are wills and trusts.  Which one is the best for your depends on your individual circumstances.

A will is a written legal declaration of your intentions on how you want your property disposed upon death.  This document is not legally enforceable until after your passing and, therefore, it can be changed at any time before you die or have diminished mental incapacity.  A will allows you to control what happens after you are gone.

A trust is a legal arrangement where a trustee manages property for the benefit of the beneficiaries.  There are many kinds of trusts, ranging from living trusts to complex dynasty trusts.  Each type of trust has its own benefits and drawbacks, so talk with us about which one is the best fit for your circumstances.

Although there are many types of trusts, the one most people need is a living trust.  It’s a great alternative to a will, because it can be changed during your life, can provide financial protection should you become incapacitated, and yet often is easier and less expensive for your family to handle upon your death.  Another common type of trust is a testamentary trust, which is one that is contained within the provisions of the will.  Just like a will, a testamentary trust is not operative until your death, making them a little less flexible and more limited in function.

Benefits of Estate Planning

Estate planning can help provide financial stability for loved ones, designate a guardian for minor children or disabled family members, distribute property to chosen charitable organizations, reduce tax liabilities, and achieve other personal and family goals.  Organizing your financial and legal affairs is your opportunity to make impactful decisions on your assets, money, and healthcare and leave a legacy after you are gone.

Planning your estate may feel like a daunting task.  We’re here to help.  You don’t have to do this alone.  Call or contact us today to discuss your options and organize your future.