Top ten reasons to create an estate plan
With an estate plan, you can:
- Provide support and financial stability for your surviving spouse, children, and grandchildren.
- Preserve your wealth for later generations.
- Make sure your wishes are carried out when you can no longer manage your affairs.
- Support a favorite charity or cause with a gift of money, securities, or other property.
- Distribute assets in a timely fashion, with a minimum of legal hassle.
- Minimize taxes and expenses that can go along with transferring assets.
- Provide enough cash to meet expenses and prevent the forced sale of assets.
- Avoid problems for your loved ones by ensuring that the beneficiaries named on your life insurance and retirement plans are still the people you want to benefit.
- Protect your family’s privacy
- Set and meet expectations of your survivors so there is no confusion or misunderstanding.
Why do you need an estate plan?
There is a common misconception that only the wealthy need to develop a estate plan. However, everyone needs an estate plan to ensure that their wishes following death are properly carried out, including the decedent’s family and financial goals.
Having an estate plan also avoids one of the common causes of disputes and conflicts following the death of a loved one – competing views of the decedent’s wishes. It is common for every family member or loved one to feel as though they had a special connection with the decedent entitling them to a greater proportion of the decedent’s property upon distribution or that the decedent would have wanted them to have a specific piece of personal property, such as a family heirloom or an item with special nostalgic value. With an estate plan established prior to death, all of your wishes are explicitly expressed that leaves little to the imagination of your heirs or beneficiaries and also reduces claims against the estate or objections arising from these competing views of the decedent’s wishes.
What documents comprise the basic estate plan?
The Will – One of the common misconceptions about wills is that you only need one if you are rich or are very old. In fact, because of these misconceptions, studies have shown that nearly 56% of Americans do not possess a will. Some notable individuals who died without a vaild will include Abraham Lincoln, Sonny Bono, Lenny Bruce, John Denver, Duke Ellington, Marvin Gaye, Howard Hughes and Martin Luther King Jr.
But what many of those without a will fail to realize is that this document is an opportunity to direct your affairs, even following death. It details who you want managing your estate upon your death and also the disposition of your real and personal property. Without a will, contests between family members or friends can arise as to who will manage the estate or as to the disposition of your property, complicating the probate process during the emotional period following the loss of a loved one. Give clarity to your last wishes and execute a will with Bayer & Kaufman LLP.
Durable Power of Attorney – Many people believe an estate plan merely consists of preparation for events following the death of an individual. But what happens if the person has not died, but is merely incapacitated? How do you pay their mortgage or utilities or continue their small business? In this case, a durable power of attorney gives the authority to manage your affairs to another during the periods of incapacitation, including the ability to manage financial matters or conduct business. Because this power of attorney is intended to be operative during periods of incapacitation, it is effective until the grantor’s death or until revoked in writing. Make the durable power of attorney a part of your comprehensive estate plan today.
Advance Medical Directives – Healthcare professionals agree that one of the most difficult issues to discuss with patients is end-of-life care. It is difficult for people to come to terms with their own mortality and one of the fundamental questions involving end-of-life care: when is enough enough? The Terry Schiavo case illustrated the strain these types of decisions can put on a family when your end-of-life care decisions are unknown. Otherwise known as a living will or health care proxy, the advance medical directive is a set of instructions detailing what should be done for an individual’s health in the event they are no longer able to make those decisions because of illness or incapacition. The directive will lay out what measures should be employed in the event of such illness or incapacitation and names an individual who will be empowered to make those decisions on your behalf. Have you made your end-of-life care decisions?
In addition to the basic estate plan, Bayer & Kaufman LLP can assist in the creation of revocable, charitable, or real estate trusts for those seeking more advanced estate planning.