Estate Planning – Who Needs It?

Who Needs Estate Planning?

Many people, when they hear the words “estate planning,” don’t think it applies to them. “I don’t have an estate to plan!” they may say. I think this comes about from the use of the word “estate.” The word is often used to refer to the mansions and real estate holdings of the rich and famous.

But the definition of an estate is “all of the things that a person owns.” In other words, your estate is the sum of your stuff: your home, your bank accounts, your
stocks and bonds, your retirement account, your cars and boat, and your personal property. For some, including young parents, the biggest asset at death will be their life insurance policy. When they say they don’t have an estate, they are forgetting about what they leave behind with insurance.

Big or small, most adults have an estate of some sort. If you don’t plan for it, don’t worry, the state has a plan for you; it just may not be what you want.

Estate Planning is More than Distributing What You Own at Your Death

While a large portion of estate planning is determining how your estate will be distributed at death, a good estate planner is doing much more. The estate planning professional should assure that you have the right things in place in case you become incapacitated. Who will manage your assets and your financial affairs if you can’t? Who will make decisions about your healthcare? With proper planning, you decide that and make sure that the person you choose can quickly take charge of your legal and financial matters.

Without proper planning someone will have to ask the court to appoint them as conservator of your finances and guardian of your person. You can’t guarantee it
will be who you would choose. I can guarantee it will be a time-consuming, expensive, and public proceeding for you and your family.

Putting an Estate Plan in Place Means More than Writing a Will

As you may already have surmised, a Will isn’t going to be enough. If you are alive but can’t take care of your financial matters, a Will doesn’t help you – it’s only effective upon your death. Instead, you need a Will along with a whole series of other documents to assure that you have a proper estate plan.

For someone to handle your financial affairs while you are incapacitated, you need a Durable Power of Attorney. You need a Healthcare Power of Attorney to appoint who you want to make health care decisions if you can’t. At my office, we also do a general release to permit your financial and health caregivers access to your medical records, which can be difficult with the federal HIPPA laws preventing disclosure.

Avoiding Probate at Your Death Is Important Too

Most of my clients come in wanting to avoid probate. This is an important part of estate planning as well. We have several methods to do this, all of which protect
you while you are still living, but still provide for an easy distribution at your death. Homemade probate avoidance techniques, like putting one of your children
as a joint owner of your bank accounts or other assets can have disastrous consequences. Estate Planning is one place where getting an expert involved can save your family great time, expense, and heartache.

Revocable Living Trusts are Great for Incapacity Planning and Distributing Your Assets

One of the most effective ways to address planning for your incapacity and for your death is the Revocable Living Trust – all without court intervention. The
Revocable Living Trust:

• Is controlled by you until you are incapacitated or pass on
• Is readily accepted by financial institutions
• Provides detailed instructions and directions from you to your successor trustee
• Holds your successor trustee to a high fiduciary standard
• Allows your successor trustee to quickly and efficiently begin managing your assets to care for you and your finances during incapacity, or to manage and distribute your assets on death

Learn More About Estate Planning

I try to make it easy to learn more about estate planning. My website ( www.libbybanks.com ) has lots of information. I also offer a free initial consultation where we can discuss your specific situation and what estate plan will work best for your situation. Call the office at 602-375-6752 to schedule our meeting in person or via Zoom or phone.