All too often when an accident or sudden illness debilitates a loved one, their family is left trying to figure out how to keep them from losing everything they’ve worked so hard for. This is why it is my firm belief that basic estate planning, asset preservation, and planning for a health catastrophe or death, is something that everyone should consider seriously.
Personal Estate Preparations
Some estate planning can be completed on your own. The simplest form of estate planning is to have a bank or brokerage account that is either:
- In joint names with right of survivorship with another person;
- “In trust” for another person;
- Payable on death to another person; or
- Names someone as a beneficiary (as in a life insurance policy and IRA).
This course of action is the cheapest and the easiest way to direct assets upon your death and, although it may not be appropriate in every situation, in certain cases I would recommend it.
Additionally, there are 3 simple steps that everyone should take to save your loved ones’ time, money and unnecessary anguish after your death. The person of your choosing should know:
(1) Your financial set-up in case of an emergency;
(2) A list of where the bank books, insurance policies, deeds or mortgage papers are kept, which should be in an easily accessible place (not a safe deposit box); and
(3) The location and type of your health and/or disability coverage
Legal Documents For Estate Planning
A method of leaving assets on death is by having a Will. It can be simple or complex, depending on your circumstances and goals, and the bequests can be outright or in trust. If you have a Will, it must be probated in the local surrogate’s court which results in probate fees paid to the court, the Will becomes a public document, legal fees often have to be paid, and there is some time involved to have the personal representative appointed and to make the necessary transfers.
Another way to leave assets on death is to use a trust or multiple trusts. You can use testamentary trusts, which are created by a Will, living trusts (also known as inter vivos trusts) which can be irrevocable or revocable, Medicaid planning trusts, insurance trusts, marital trusts, charitable trusts, credit shelter trusts, etc. Each person’s situation is unique. There are certain advantages to using trusts, both financially and in terms of asset control. It can also avoid involving the Courts.
If you decide not to create a Will or trust, upon your death the State where you live will decide who will administer your assets and to whom they will go.
In addition to planning for the transfer of your assets on your death, there are a number of very important documents that affect you while you’re alive that everyone should have. The documents are:
- Health care proxy
- Living Will
- Durable Powers of Attorney, comprehensive long form
Together, these documents will ensure that the person of your choosing will make the medical decisions that you want and will avoid a guardianship proceeding by appointing your trusted relative or friend to act as your Agent under the power of attorney. The powers can take effect immediately or upon the happening of a certain event or circumstance.
Contact us at 914-831-6250 or firstname.lastname@example.org to find out how an estate planning attorney can help you accomplish your goals.