While the rest of the nation celebrates its independence on July 4th, you can rest assured that you too can declare independence for your family — from court interference. Life can be unpredictable. Whether it is a financial issue, the birth or adoption of a child, sickness or incapacity, it is important to be prepared with proper estate planning. In fact, failure to put together a comprehensive estate plan can leave you and your loved ones at the mercy of the court when it comes to distributing assets or caring for a minor or sick family member.
Estate Planning Basics
Simply put, estate planning addresses how to manage your property in the event of your death or incapacity. You have likely heard of the instrument called the Last Will and Testament, but do you have an up-to-date Will in place? Do you also have medical directives and Durable Powers of Attorney? Have you discussed the advantages of a Revocable Trust with your trusts-and-estates attorney? Estate planning is a great method not only to plan for your family’s financial security, but to keep your family’s personal business private.
When someone passes away without a will it is referred to as dying intestate. A person who dies intestate will have his or her assets distributed according to state statute, rather than by his or her personal plan. Probate is the legal mechanism by which your assets are distributed, under court supervision, upon your death. The process of probate takes time, costs money, and can be a hassle and burden for the family you left behind. One important estate planning tool that will help avoid a drawn-out legal process includes use of a fully funded revocable trust with up-to-date beneficiary designations. By having a fully-funded trust and/or up-to-date beneficiary designations when you die, no assets will remain in your probate estate and, therefore, your family will not need to go to court for an expensive and lengthy probate proceeding.
Death is not the only time a court may become involved in your and your family’s personal lives. The court may also intervene in the event you become incapacitated. The court may appoint a guardian or conservator to handle your personal and financial matters, essentially pushing out your loved ones and stripping their ability to help you and make important decisions on your behalf. There are several estate planning tools that can help you determine who you want to be in charge should you become incapacitated. These include a Durable Power of Attorney (so someone can manage your non-trust assets if you are incapacitated), a Revocable Trust (so the trustee can manage your trust assets if you are incapacitated), and medical directives to appoint and give instructions to those you trust to make decisions for you when you need it most.
Protecting Your Loved Ones
Another important benefit of a solid estate plan is protecting those who are most precious to you — your minor children. It is important to understand that simply naming guardians in your Will for your minor children may not be enough. Although a Will does provide for the care of your children in the long-term, you should have documentation in place to provide for the care and support of your children in the short-term. Making sure your estate plan documents include directives for the care of your children immediately after your death or incapacitation may prevent the state from taking over… and allowing someone you do not want to raise your children to have a chance to take control of their lives and inheritance.
Declare Your Family’s Independence
There are many moving parts to a coordinated estate plan that must be considered in order to properly protect yourself and your loved ones. An estate planning attorney can explain your options under applicable law and craft a plan that best suits your family’s needs. There is no need to wait and leave your family’s future to chance. Contact me today so we can get you on the road to independence.