What is estate planning?

Estate planning is a process to consider alternatives for, to think through, and to set up legally effective arrangements that would meet your specific wishes if something happens to you or those you care about. Good estate planning is more than just a simple Will. Estate planning also typically minimizes potential taxes and fees, and sets up contingency planning to make sure your wishes regarding health care treatment are followed.

On the financial side, a good estate plan coordinates what would happen with your home, your investments, your business, your life insurance, your employee benefits (such as retirement accounts), and other property in the event you became disabled or if you die.

On the personal side, a good estate plan includes directions to carry out your wishes regarding health care matters, so that if you ever are unable to give the directions yourself, someone you select would do that for you.

Does it make sense to use an attorney?

Only an attorney who regularly practices in the fields of wills, trusts, probate and estate planning is able to provide you with really sound legal advice as you put your estate plan into place. Attorneys are subject to regulation by state bar organizations, many of which have continuing education requirements and mandatory liability insurance in case the lawyer makes a mistake.

When you speak with an attorney, you can get answers to your questions.
Often the expense incurred in retaining an attorney to prepare and help you put an estate plan into place is worth hundreds of times what you and your family would pay with no planning or poor planning. It would also avoid the financial and emotional nightmares that can occur with a poorly drafted (or improper) plan.

What is an estate?

The term estate consists of all the property a person owns or controls, whether in his or her sole name, held in a partnership, in a joint ownership arrangement, or through a trust, and all other monies that would be generated on the person`s death.  It includes:

• real estate;
• personal property ;
• business interests (sole proprietorships, partnerships, corporations, LLC, LLP, and  joint ventures)
• powers of appointment (the right to direct who gets someone else`s property);
• life insurance and annuity contracts, pension benefits, IRAs, 403(b)s, etc.
• debts and obligations owed to others ;
• claims you have against other people or entities;

When should I start my estate plan?

The only time that you can prepare and implement an estate plan is while you are alive and have legal capacity. If you are unable to manage your own affairs or suffer from some other disability which affects your legal capacity, your estate plan may be effectively challenged by those who assert that you lacked capacity at the time the documents were created, that you were subjected to fraud, coercion or undue influence during the creation and implementation of your plan.
The best time to start an estate plan is now, while you have the capacity to do so.

Should I have an estate plan?

You should have an estate plan if:

• you are the parent of minor children
• you have property that you care about
• you care about your health care treatment.

What sort of instructions are made as part of an estate plan?

An estate plan consists of one or more documents that set forth instructions to your personal representative, trustee, attorney-in-fact or health care representative, as the case may be.

How can an estate plan prevent a guardianship proceeding?

An estate plan uses several tools which can prevent the court from gaining jurisdiction over your affairs.

A Living Will or Directive to Physicians is used to determine if artificial life support systems are to be used or withheld.

A Durable Power of Attorney for Health Care is used to provide authority to a person, in whom you have the utmost trust and confidence, to make decisions regarding health care treatment when you are unable to provide informed consent.

A Durable Power of Attorney for Property enables you to authorize a person to act in your place and stead in the event of your incapacity; this attorney-in-fact can manage your financial affairs without the need to have intervention by the courts.

A Trust or Family Limited Partnership is used to hold property; the Trustees or Partners manage the property held by either of these entities.

Both the Trust and the Family Limited Partnership continue to manage the property even if you are incapacitated.

Thus, a properly prepared estate plan can enable you to avoid a Guardianship proceeding over your estate. Compared to the cost of a Guardianship proceeding, an estate plan can be very attractive.