ESTATE PLANNING

What is retirement planning?

What Is Estate Planning?

Estate planning is the process of designating who will receive your assets in the event of your death or incapacitation. Often done with guidance from an attorney, financial planner, and accountant, one goal is to ensure your heirs and beneficiaries receive assets in a way that manages and minimizes estate taxes, gift taxes and other tax impacts. The core document most often associated with this process is your will. 


When should I address my estate planning needs?

Effective estate management enables you to manage your affairs during your lifetime and control the distribution of your wealth after death. An effective estate strategy can spell out your healthcare wishes and ensure that they're carried out – even if you are unable to communicate. It can even designate someone to manage your financial affairs should you be unable to do so. Estate planning should be addressed as soon as you begin accumulating assets.

Inventory & Letter of Instruction

We recommend that you keep an inventory of your tangible and intangible assets, along with an estimated value.

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Living Wills, Health Care Proxies, & Advanced Health Care Directives

A complete estate plan includes important legal directives to address important decisions that would need to be made in the event you are unable to express your own preferences about treatment.

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Living Trusts

Living trusts (also known as a "revocable living trust," "inter vivos trust," or “loving trust”) as a solution for a wide variety of problems associated with estate planning that wills cannot address. 

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Powers of Attorney

An important part of lifetime planning is the power of attorney. A power of attorney gives one or more persons the power to act on your behalf as your agent.

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Inventory & Letter of Instruction

You may think you don't have enough assets to justify estate planning. But once you start looking around, you might be surprised by all the tangible and intangible assets you have. After you inventory your tangible and intangible assets, you need to estimate their value. When you don’t have an outside valuation, you may value the items based on how you expect your heirs will value them. This can help ensure your possessions are distributed equitably among the people you love.

Living Wills, Health Care Proxies, & Advanced Health Care Directives

With the increasing ability of medical science to sustain our lives, people are living much longer than ever before. Unfortunately, as we grow older, or if we experience health challenges, we may find ourselves in a position in which decisions need to be made as to how we wish to be treated in a variety of medical situations. This is especially true at the end of our lives, but can be true at any time as a result of the impact of an accident, injury, or illness. If we are in a condition such that we no longer can express our preferences about treatment, decisions will be made for us by others if we have not planned for our own treatment in advance. Advance health care directives allow us to deal with these situations. Without such directives, our families may find it necessary to obtain court orders to deal with our medical situations.

State laws vary concerning the appropriate documents to cover these situations. All fifty states permit you to express your wishes as to medical treatment in terminal illness or injury situations, and to appoint someone to communicate for you in the event you cannot communicate for yourself. Depending on the state, these documents are known as "living wills," "medical directives," "health care proxies," or "advance health care directives." Some states have a standardized or statutory form, while other states allow you to draft your own document. But even if you use a standard or statutory form, you should review it to be sure that it comports with your personal wishes. Never sign a document presented to you as standard unless you have read and understood it and confirmed that it does in fact reflect your desires.

Living Trusts

Much has been written regarding the use of "living trusts" (also known as a "revocable living trust," "inter vivos trust," or “loving trust”) as a solution for a wide variety of problems associated with estate planning that wills cannot address. The choice of a living trust should be made after consideration of a number of factors.

The term "living trust" is generally used to describe a trust that you create during your lifetime.  A living trust can help you manage your assets or protect you should you become ill, disabled or simply challenged by the symptoms of aging. Most living trusts are written to permit you to revoke or amend them whenever you wish to do so. These trusts do not help you avoid estate tax because your power to revoke or amend them causes them to continue to be includable in your estate. These trusts do help you avoid probate, which may not always be necessary depending on the cost and complexity of probate in your estate.

Upon your death, the trustee is generally directed to either distribute the trust property to your beneficiaries, or to continue to hold it and manage it for the benefit of your beneficiaries. Like a will, a living trust can provide for the distribution of property upon your death. Unlike a will, it can also provide you with a vehicle for managing your property during your lifetime, and authorize the trustee to manage the property and use it for your benefit (and your family) if you should become incapacitated, thereby avoiding the appointment of a guardian for that purpose.

Powers of Attorney

A power of attorney gives one or more persons the power to act on your behalf as your agent. The power may be limited to a particular activity, such as closing the sale of your home, or be general in its application. The power may give temporary or permanent authority to act on your behalf. The power may take effect immediately, or only upon the occurrence of a future event, usually a determination that you are unable to act for yourself due to mental or physical disability.

A durable financial power of attorney allows someone else to manage your financial affairs if you're medically unable to do so. Your designated agent, as directed in the document, can act on your behalf in legal and financial situations when you can't. This includes paying your bills and taxes, as well as accessing and managing your assets.

A limited power of attorney can be useful if the idea of turning over control of everything to someone else concerns you. This legal document does just what its name says: It imposes limits on the powers of your named representative. 

If you do not have a power of attorney and become unable to manage your personal or business affairs, it may become necessary for a court to appoint one or more people to act for you. People appointed in this manner are referred to as guardians, conservators, or committees, depending upon your local state law. If a court proceeding, sometimes known as intervention, is needed, you may not have the ability to choose the person who will act for you. Few people want to be subject to a public proceeding in this manner so being proactive to create the appropriate document to avoid this is important.

Frequently Asked Questions

  • What Are Some Examples of Tangible & Intagible Assets?
    The tangible assets in an estate may include: Homes, land or other real estate Vehicles including cars, motorcycles or boats Collectibles such as coins, art, antiques or trading cards Other personal possessions The intangible assets in an estate may include: Checking and savings accounts and certificates of deposit Stocks, bonds and mutual funds Life insurance policies Retirement plans such as workplace 401(k) plans and individual retirement accounts Health savings accounts Ownership in a business
  • What Happens if You Die Without A Will?
    If you die intestate (without a will), your state's laws of descent and distribution will determine who receives your property by default. These laws vary from state to state, but typically the distribution would be to your spouse and children, or if none, to other family members. A state's plam often reflects the legislature's guess as to how most people would dispose of their estates and builds in protections for certain beneficiaries, particularly minor children. That plan may or may not reflect your actual wishes, and some of the built-in protections may not be necessary in a harmonious family setting. A will allows you to alter the state's default plan to suit your personal preferences. It also permits you to exercise control over a myriad of personal decisions that broad and general state default provisions cannot address.
  • What is a Power of Attorney?

    A power of attorney gives one or more persons the power to act on your behalf as your agent. The power may be limited to a particular activity, such as closing the sale of your home, or be general in its application. The power may give temporary or permanent authority to act on your behalf. The power may take effect immediately, or only upon the occurrence of a future event, usually a determination that you are unable to act for yourself due to mental or physical disability. A power of attorney may be revoked, but most states require written notice of revocation to the person named to act for you.

  • What is a Living Will?

    A living will is your written expression of how you want to be treated in certain medical circumstances. Depending on state law, this document may permit you to express whether you wish to be given life-sustaining treatments in the event you are terminally ill or injured, to decide in advance whether you wish to be provided food and water via intravenous devices ("tube feeding"), and to give other medical directions that impact your care, including the end of life.

  • What is Probate?

    Probate is the court-supervised process of administering your estate and transferring your property at death pursuant to the terms of your will. It is the formal legal process that gives recognition to a will and appoints the executor or personal representative who will administer the estate and distribute assets to the intended beneficiaries. Administration and accounting for assets must be done whether the estate is handled by an executor in probate or whether probate is avoided because all assets were transferred to a living trust during lifetime or jointly owned. In planning your estate, more important than minimizing probate is minimizing the real issues that can make probate difficult, such as lawsuits by heirs.

Estate planning is a process involving the counsel of professional advisors who are familiar with your goals and concerns, your assets and how they are owned, and your family structure. It can involve the services of a variety of professionals in addition to your financial planner, including your lawyer, accountant, or banker. Whether you should hire an attorney or an estate tax professional to help create your estate plan generally depends on your situation. If you have questions about estate planning or how to begin the process, please please reach out to us to discuss your circumstances.

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