For years, we have been assisting individuals, couples, and families with their estate planning needs. Our services have ranged from the preparations of simple wills, and powers of attorney, to asset transfers, and living wills and to the creation of complicated wills and trusts.
Here is a brief overview of the more common documents prepared in an estate plan. Please keep in mind that not all of these documents may be required in your specific situation.
Power of Attorney – a power of attorney permits the individual(s) named in the document, your attorney(s)-in-fact, to act on your behalf with respect to the management of your assets and to make legal decisions on your behalf. If the power of attorney is durable, the attorney-in-fact may continue to act on your behalf in the event that you become incapacitated. Powers of attorney are vital documents for most people, without a power of attorney in place a conservatorship may be necessary upon an individual becoming incapacitated in order for that individual’s financial affairs to be managed on his or her behalf.
Health Care Directive – a health care directive, also referred to as a living will, grants authority to the individual(s) named in the document, your health care agent(s), to make health care decisions on your behalf. Your health care agent is authorized to consent to or refuse medical treatment on your behalf if you are unable or unwilling to make decisions for yourself. A health care directive also communicates your wishes to your health care agent regarding medical measures such as life support, artificial nutrition and hydration and organ donation.
Will – a will is the document in which you direct the disposition of your assets upon your death. In your will, you also nominate a personal representative to manage the payment of your final expenses and the gathering and distribution of your assets. If you have minor children or are the guardian or conservator for any individual, your will is the document in which you nominate another individual to serve as guardian and/or conservator after your death. A will may be a stand alone document or may be used in conjunction with a revocable living trust.
Revocable Living Trust – a revocable living trust (“RLT”) is often considered a will substitute. It also provides direction for the disposition of your assets upon your death. However, a RLT, if funded properly, permits your assets to pass to your heirs without going through the probate process with the court. RLTs also provide terms for the management of your assets during your lifetime. These documents are most commonly used in situations where an individual owns real estate in multiple states; when probate avoidance is desired; when planning for estate taxes is necessary; or when long term asset management for the benefit of descendants or other beneficiaries is desired.
Deeds – quite frequently during the estate planning process real estate is retitled by the use of deeds. There may need to be a change of ownership with respect to your real estate, such as ensuring that a jointly owned property is owned as joint tenants with rights of survivorship or in transferring assets into a revocable living trust. For smaller estates, transfer on death deeds are a convenient tool to pass real estate to beneficiaries upon the death of the owner without requiring probate.
Change of Beneficiary Forms – once your estate plan is in place, it is important that all of your beneficiaries on your life insurance and retirement plans work with the plan you put into place. Accordingly, during the estate planning process, you should expect to complete new designation of beneficiary forms of these types of assets. Your investment advisor may assist you with the completion of these forms, you may chose to complete the forms yourself, or you may wish for your estate planning attorney to complete these forms. The completion of these forms is vital to the planning process as assets with old beneficiary designations often are distributed in a manner that is not consistent with your intentions after your death.