A Will is a Key Component of an Estate Plan, But it May Not Be Enough
When people think of creating an estate plan, a will is often the first thing that comes to mind. A will lays out where your assets should go, and who gets what when you die. And while a will is a key component of an estate plan, it often isn’t enough, and, in fact, is a fairly limited tool when it comes to an estate plan.
It is important to have a comprehensive plan in place.
What Are Basic Estate Planning Documents?
Estate planning is an in-depth way to ensure that your family is taken care of at the end of your life and after your death. Estate plans use different types of documents to meet your goals. This can include your will, as well as a living will, which involves you dictating your requests while still alive. For instance, a living will explain the type of medical care you would want, should you become incapacitated, and are unable to speak. It can also help your family make difficult end-of-life decisions and save them money. With an estate plan, you can designate a financial power of attorney. This is someone who can handle your finances, if you are incapacitated, and unable to do so. The attorney-in-fact will be able to make transactions on your accounts, business decisions, and other financial decisions, based on what you set out to allow. Establishing a power of attorney for your finances is a good way to keep your financial situation stable, should you lose the ability to manage your finances.
If you have minor children or teenagers, they may be set to receive a large amount of money through your will. Handing a young adult a large sum of money can be stressful and difficult to manage for that loved one. There are ways to set them up for success. A trust, for instance, can hold the money for your children, until they are better able to manage it. There are several types of trusts, including revocable and irrevocable trusts. An experienced estate planning attorney can help you decide which one is right for you.
Another issue with only having a will is having to go through probate. After someone dies, their estate enters probate, which is the court-supervised process in which the deceased’s assets are distributed to bill collectors, taxes, and inheritors. This process, which is time consuming and can be expensive, can be avoided with the use of estate planning tools to protect and distribute your assets. A will tells the court how assets should be distributed, but it can take months. During that time period, bills need to be paid, and other assets, like property, need to be maintained. Avoiding probate can be a beneficial thing for your family or loved ones.
If you are in an assisted living situation at the end of your life, Medicaid may try to recoup some of the money they paid for you during the probate process. Having only a will isn’t protection against this or other creditors. Setting up other provisions, like trusts, can help to protect your assets for your family after you die.
As you move through the estate planning process, consulting an experienced estate attorney can help you decide which devices are best for you.
The Mattar Firm Estate Planning Attorneys
Whether you need a will or a trust, or maybe you aren’t sure exactly what estate planning documents you need, The experienced estate planning attorneys at The Mattar Firm can help. Sign up for one of The Mattar Firm’s free asset protection workshops or call for a consultation. 239-222-2222. Contact us today!