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The most important documents to have in your estate plan are your will, a trust, power of attorney, medical directives, and beneficiary designations. These documents make it easier for your loved ones to manage your care during incapacity and to settle your estate when you die. So what exactly is estate planning? It’s the process of deciding who will receive your assets and manage your estate when you are ill or pass on. There are many important legal documents you should consider having as part of your estate plan. We’ll go over each one, why it’s important, and how to get it.

Make A Will

A will is a written document that sets out your instructions and wishes on how you want your estate (your money, property, possessions, and other assets) to be distributed after your death. Intestacy is the condition of the estate of a person who dies without having in force a valid will or other binding declaration. When this happens, the deceased’s estate is handed over to probate courts to identify beneficiaries and allocate assets. In almost all cases, intestacy is best avoided. You may want to speak to a lawyer to make sure your will is valid. It can be altered at any time. In lieu of your will, state law determines who your heirs are and how much of your property they inherit.

How To Structure Your Will

While there are many sections in a complex will, most simple wills follow a basic structure.

  • Your name and personal details: A will begins by naming the person who is making the will. They are called the “testator.”
  • The statement revokes prior wills: This cancels any wills you wrote in the past so that you don’t have two wills conflicting with each other and causing confusion as to which are your real instructions.
  • Statement naming your executor: The person who will carry out your wishes/instructions in your will is named. They are called an “executor.” Your executor must be someone who is over the age of 18 and mentally competent. This person is responsible for arranging your burial, making a list of all the things you own, calculating all the money that you owed to people, and giving out gifts to the people set out in the will.
  • List your property and who will receive it: This is where you name the different people or organizations who will receive the things you own when you die. These people are called “beneficiaries.”
  • Residue clause: This part names a beneficiary of anything that is NOT listed under the fourth part of your will, which is anything left over after all debts have been paid and all other gifts have been distributed.
  • Date and sign the will, and have it witnessed: The most important section of any will is the signature page. It should be dated and signed at the bottom. If the will is typed, then two witnesses must also sign at the bottom and initial each page of the will. They will also need to sign a sworn statement, called an affidavit, that confirms that you signed the will in front of them. No witnesses are needed if you handwrite your entire will from beginning to end.

Establish A Trust

While there are many types of trusts that serve many different purposes including asset protection, they all have common elements. A trust is a legal agreement among three parties:

  • The trustor (or settlor or grantor)
  • The trustee
  • The beneficiary

Use a trust when you want your estate and your loved ones to avoid the probate process. No matter the type of trust you establish, it can avoid probate and help you pass on your wealth to the next generation of your family without unnecessary delay and expenses.

A Trust Avoids Probate

When a trust is set up correctly, there is no need to go through probate. Whomever you have named as the beneficiary of the trust will automatically become the owner of the assets. The court doesn’t need to oversee the transfer of ownership for the assets, which are placed into the trust. When you pass on, the trustee can settle your trust more quickly than during probate, allowing your named beneficiaries to inherit your wealth as you intended.

A Revocable Living Trust And Irrevocable Trust

A revocable trust can be changed at any time by the grantor during their lifetime, as long as they are competent. An irrevocable trust usually can’t be changed without a court order or the approval of all the trust’s beneficiaries. This makes an irrevocable trust less flexible. The amount of control you have over the assets you fund into your trust depends on the type of trust you establish.

Name A Power Of Attorney

Your estate planning should contain more than postmortem affairs. You should plan for any incapacitation you may experience before you pass away.

  • A Durable Power of Attorney: A Durable Power of Attorney document (for financial purposes) authorizes someone else, other than you, the pensioner, to manage certain matters and affairs, such as finances, on your behalf. A Durable Power of Attorney will remain in effect even if you become physically or mentally disabled.
  • A Special Power of Attorney: Special Power of Attorney refers to a person delegating specified powers to an attorney to act on their behalf. Unlike general power of attorney which gives wide-ranging decision power, special power of attorney limits the area of decision-making or the specific decisions possible. A special power of attorney is limited in its scope. Special power is very specific when it comes to which and when power is valid.
  • A Medical Power of Attorney:  A Medical Power of Attorney for Health Care is a document that lets you name someone else to make decisions about your health care in case you are not able to make those decisions yourself. It gives that person (called your agent) instructions about the kinds of medical treatment you want.

Living Wills And Advance Directives For Medical Decisions

Plan ahead and get the medical care you want at the end of your life. Through advanced medical directives, patients can clearly state their wishes and preferences regarding medical treatments. Having an advanced directive ensures that the patient’s wishes will be respected when making important healthcare decisions. It is important to note that each state has its own laws and regulations governing advanced medical directives. So, it is critical to understand the requirement of the State you are living in. Physician orders for life-sustaining treatments are on record. If you are in a hospital or nursing home, the document is posted near your bed. If you are in a hospice care facility, the document is prominently displayed where emergency personnel or other medical team members can easily find it.

Designate Beneficiaries

Beneficiary designations allow you to transfer assets directly to individuals, regardless of the terms of your will. Beneficiary designations are often made when a financial account, retirement account, or life insurance policy is established. But, these designations should be reviewed periodically. In many states, they are an important part of estate planning. To avoid any issues with asset transfers, it is wise for individuals to consult an experienced estate attorney who can provide guidance on creating a valid beneficiary designation and making sure all necessary documents are completed properly.

Estate attorneys will work with you to create a comprehensive plan that meets your needs and helps ensure the security of your assets in the future.

Contact Us (859-371-0730) for a Consultation Today

About Helmer Somers Law

Helmer Somers Law helps individuals and businesses navigate the complex system of rules that accompany all legal situations. We are licensed to practice in both Kentucky and Ohio and offers flexible, affordable payment terms for our services. We welcome the opportunity to earn your trust and become your lawyer for life! It’s a fact of life in the modern world. There comes a time for virtually every adult American when the services of a competent, dedicated lawyer are required. Circumstances such as divorce, bankruptcy, estate planning or an income tax audit demand that your rights be protected, and your long-term interests advocated for with diligence and perseverance. When you call Helmer & Somers Law, you can rest assured that they will be.

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