What is Estate Planning and What Are Basic Estate Planning Documents?
It’s understandably difficult to think about your death or incapacity.. It can also be hard to discuss with loved ones. The benefits of estate planning greatly outweigh the uncomfortable feelings surrounding the process. It’s normal to have mixed feelings about planning for death, but it can be extremely helpful in case of your incapacity and at death. Estate planning can help alleviate some of the hard decision making your loved ones are facing and may help reduce intrafamily fighting because you have made your desires known.
Estate planning is something that you may have associated with Wills and end-of-life planning. While that’s certainly one element of estate planning, it’s not just something to plan for toward the end of your life. You should begin estate planning before nearing end of life and before potentially becoming incompetent to execute estate plan documents. Here's some important information you need to know about estate planning and what to expect when starting the process.
Estate planning is essentially the process of preparing for future events. Some events are expected, such as death, while other events are unexpected, such as suffering an illness that may leave you incapacitated and unable to manage your affairs and make your own decisions.. Basic estate planning involves the creation of certain documents such as a Last Will & Testament, Durable Power of Attorney, Designation of a Health Care Surrogate, Living Will, Declaration Naming Preneed Guardian, and often a Revocable Living Trust or other type of trust instrument.
Common Estate Planning Documents
Last Will & Testament
A Last Will & Testament is an excellent document that contains your instructions and desires regarding your estate and beneficiaries. In a Will, you name the beneficiaries of your estate and the certain real and personal property which you would want that beneficiary to receive upon your death. Proper handling of assets is one major element of the process. This may include items of personal property such as, vehicles, jewelry, artwork, and personal belongings and also accounts such as, bank accounts, IRA’s, 401(k)’s, portfolio accounts, stocks, life insurance, and pensions, to mention a few. The attorney will review the nature of your assets and discuss designating a beneficiary for certain assets, as part of the estate planning process, in conjunction with your Will. You also designate a personal representative or executor to carry out your wishes according to the terms in your Will. A Will can also state specific burial or cremation wishes as well.
Durable Power of Attorney
A Durable Power of Attorney is a document that gives the “Attorney-in-fact”, which you name in the document, the power to carry on your financial affairs and other matters you specify in the document. A Durable Power of Attorney allows this grant of authority to the Attorney-in-fact to continue even when you become incapacitated. This fact is important to help ensure the “smooth” handling of your affairs after you may become incapacitated during your life. The Durable Power of Attorney is not valid after your death.
Designation of Health Care Surrogate
In this important document you can plan for future health care events or diagnosis that may leave you unable to competently make your own health care decisions. You name a person (called the “surrogate”) who you want to have the power and authority to make health care decisions for you when necessary. By designating your health care surrogate, important medical decisions can be made on your behalf when you are unable to make these decisions. Your medical professionals will also clearly understand who this person is that you have designated to make those medical decisions. You may also provide HIPAA authorization, which authorizes the release of your medical records to specific trusted individuals you designate.
Living Will
This document allows you to direct that your dying not be prolonged by artificial means when you are either in a terminal or end-stage condition or in a persistent vegetative state, as determined by at least two treating medical physicians, that there is no reasonable medical probability of your recovery from such condition. This document is very important and can help alleviate some difficult decisions for your family members.
Declaration Naming Preneed Guardian
A declaration naming preneed guardian is a document where you can name a guardian for yourself in case the situation arises where you become incapacitated and a guardianship petition is filed requesting appointment of a guardian for you. Typically, a family member initiates guardianship proceedings to determine your incapacity and assume control over your life to the extent ordered by the court. The court will follow Florida law to designate a guardian, such as a blood relative or spouse, or sometimes a professional guardian and the court’s choice may not be the same as what you would desire. With a Declaration Naming Preneed Guardian, the Judge can understand who you desire to be your guardian when you may be unable to express that wish. Parents can also designate a guardian for their minor children in case of the parent’s incapacity or death.
Revocable Living Trust
Assets owned by your living trust do not require a probate administration to properly pass them to your heirs and can be of great benefit in time and money. Although, some trust documents, such as a notice of trust still need to be filed with the court. A trust can also maintain a higher level of privacy since there is no probate. A trust will include a named trustee who can act on behalf of the trust as well and this can be of benefit should you become incapacitated. If you own real estate in different states, a trust can work to avoid potential probates in each state.
Who Needs Estate Planning?
Anyone can benefit from estate planning. The sooner you begin the process, once attaining 18 years of age, the less overwhelming it may feel. A young adult can benefit from certain estate plan documents because a natural parent no longer as legal authority to make decisions on their behalf, in most situations, without some type of estate planning document. As mentioned in this article, documents such as a durable power of attorney, health care surrogate, and declaration naming preneed guardian concern your decision-making rights rather than disposition of assets and are important documents for all of us, regardless of financial status. Even if you feel like you don’t have a lot of assets, having these documents and a Will may greatly help reduce the uncertainty and anxiety for your loved ones.
How To Create An Estate Plan
Although the process can feel overwhelming, creating an estate plan can be made much easier when contacting Leggett Law Offices. The attorney will work with you to inventory your assets and discuss your future needs and goals and create an estate plan that helps meet those desires.Upon drafting the appropriate estate plan documents, you will execute or properly sign these documents which is an important step in the process. It’s also important to store your documents in a safe place such as a safe deposit box or secured fireproof place at home, such as a safe, and ensure a trusted family member or friend can access these documents in a time of need.
How Much Does Estate Planning Cost?
The cost of an estate plan can vary from person to person depending upon the complexity of the estate plan and the documents drafted. The attorney and client can discuss a fixed fee for the necessary documents that need to be drafted to meet the client’s needs and goals. In some situations, an hourly rate may be appropriate as well.
If you are beginning the process of creating an estate plan and aren’t sure where to start, you don’t have to do it alone. In fact, it’s not advisable to do it alone. The process can be time consuming, difficult to understand, and confusing. The attorney understands the legal aspects and will guide you through the process. Leggett Law Offices are here to help you you through the process and explain the different estate plan documents. We can help you with any questions you may have about creating an estate plan. Contact Leggett Law Offices today to get started!
