Estate Planning ABCs
Even if your estate is something less than Downton Abbey, there’s still plenty to think about.
But first: Please bear in mind as you read this that the specifics of estate planning are highly individual. What’s appropriate for one person, or family, may not be at all suitable for another.
Also, the whole area of estate planning is governed by state law. So make sure you get information that pertains to where you live or where your property is located — especially if you have moved from one state to another.
And the legal disclaimer: nothing here should be construed as legal advice. For your specific situation, please make sure you consult a lawyer or other appropriate professional.
Here are some of the basic estate planning tools:
Wills
A will is a simple planning document that specifies what happens to your property when you die. This can include everything, from real estate to intellectual property to everyday “stuff.”
Get more information about wills here.
Trusts
A trust is a much more complicated document that provides for another person (the trustee) to handle your property when you die — and distribute it according to the provisions specified in the trust.
Get more information about trusts here.
Specialized trusts
If you think your estate might be large enough to be subject to federal estate tax ($5,600,000 per person in 2018), there are a number of tax-saving instruments that can help you minimize the tax bite.
Get more information about specialized trusts here.
Special Needs trusts are for people with cognitive or emotional disabilities who are not competent to handle their own affairs.
Get more information about Special Needs trusts here.
Advance Directives
There are many different names for this instrument — including Living Will, Advance Health Care Directive, Durable Power of Attorney for Health Care, etc. The essential element is that it is a legal document that gives other people instructions about your medical care if you are unable to do so yourself.
Get more information about Advance Directives here.
Powers of Attorney
A Power of Attorney goes farther than an Advance Directive in that it designates another person to act on your behalf in handling your personal matters such as for finances or business.
Get more information about Powers of Attorney here.
Getting Organized
Guess what? No one can read your mind — especially when you’re not there anymore. So give them a hand. Make lists!
Get some ideas about how to do that here.
Regular Review
It is always a good idea to review these instruments from time to time. Laws change, wishes evolve, relatives reform (sometimes).
Remember also that insurance policies, retirement accounts, any property held in joint tenancy, will be distributed according to the terms set forth in that document or instrument, not according to your will or trust. So make sure those documents still reflect your wishes.
