Isn't estate planning only necessary for the wealthy?
Some people choose not to prepare a will or a trust because they think that their own personal estate is not large enough to justify going to the trouble of creating an estate plan. Everyone can benefit from estate planning. If you want to ensure that your loved ones receive the maximum value of your estate and receive the benefit of your generosity with a minimum of delay and difficulty, it is vital to prepare an estate plan.
What is the difference between a will and a trust?
Wills and trusts both direct the distribution of your personal estate upon your death. A will details your wishes concerning who will receive what out of your estate, and it goes into effect the day you die. A trust, on the other hand, is a legal entity to which you transfer your personal assets, and from which payments are made to beneficiaries according to your directions. For example, you may direct the trust to make regular monthly payments to your heirs, or it might make a single lump-sum payment.
Do I need a will or a trust?
Generally, it depends on the size and complexity of your personal estate. If you possess a relatively modest estate, and have simple plans concerning the manner in which your assets are to be disposed, a will may meet your needs. If, on the other hand, you have a large estate, you may be better off with a trust. For example, you may wish to use a trust to minimize estate tax. We can review your personal circumstances to help determine what course of action is best suited for you.
What is probate?
Probate is the legal process of examining a will to determine its validity, followed by distributing the assets of the estate and executing the terms of the will, all under court supervision. The executor of the estate is required to gather and inventory all of the estate's assets, notify any creditors who may have a claim to the estate and notify any and all heirs to the estate.
Why should I try to avoid probate?
Probate is a complex and often lengthy process, one which can take several months or even more than a year to complete. It often places a considerable financial drain on the estate, between the financial impact of court costs and that creditors can file claims against the value of the estate. Further, it offers the opportunity for family members to file their own claims if they feel that they have not received their fair share. Finally, probate is a matter of public record, so anyone has access to the details of the case. Avoiding probate often means saving considerable amounts of time, money and stress.
What is a living will?
A living will is an estate planning document that makes your wishes known concerning medical treatment and end-of-life care in the event you are incapacitated by a serious injury or illness. Thus, instead of leaving difficult decisions to your family and doctors concerning how long to keep you on life support, for example, a living will gives clear directions. A similar document is a healthcare proxy, in which you appoint another person to speak for you if a decision must be made on a matter not covered in your living will.
What is a power of attorney?
A power of attorney is similar to a healthcare proxy, as it is used to appoint another person as your legal representative. In a power of attorney, you will name another person to make important decisions about your estate and your finances in the event that you cannot speak for yourself.