An estate plan not only provides a plan for your assets but also benefits you greatly at the end of your life and your loved ones after your death. You can save your family members and loved ones a lot of time, stress, and money simply by having a legally enforceable and effective estate plan.
Basics of an Estate Plan
The main aspects of an estate plan are:
- A living will
- A trust
- Durable power of attorney
- Medical power of attorney
These documents provide for end-of-life decisions if you become incapacitated and protect your family from the probate process. They also put into place care of minor children. These documents are useful to create during adulthood and continually update after any major life changes. There are several benefits to creating a comprehensive estate plan.
Saving Your Family Time and Money
Without a valid estate plan, your assets after death enter probate court. This is the process of the state of Kansas determining what happens to assets and property after death. Decisions will be made by courts and executors who you didn’t appoint and who are unaware of your interests. They may give your estate to beneficiaries you wouldn’t name.
Even if your estate does end up in the hands of those you wanted to inherit from you, it will take time before they can receive the benefits of your estate. Probate is a long process and can take years. Probate is also expensive. That means that many of the financial benefits you wanted your beneficiaries to receive are cut into by the probate process.
An estate plan also allows you to determine who cares for any minor children you have. The loss of a parental figure is always going to be hard on children, but it can be worse without the constancy of another guardian. Many members of the family may disagree about who should raise your children, creating a stressful environment. You only have control over who cares for your children by creating a legally valid estate plan.
Protect Your Interests at the End of Your Life
A comprehensive estate plan includes the durable power of attorney and the medical power of attorney. Both of these documents explain the care of you and your finances if you are incapacitated in a medical emergency. Few people anticipate being incapacitated, but emergencies do happen, especially as people reach the end of their life.
- Durable Power of Attorney: This document designates someone in your life to handle financial decisions, such as paying bills, managing accounts, and other routine matters. This person may be a family member, loved one, or professional.
- Medical Power of Attorney: This document puts a person in charge of decisions about your medical and health care, as well as personal decisions.
Additional documents included with medical power of attorney can designate where you would like to receive healthcare and other wishes regarding your medical care.
Without these decisions in an estate plan, your family and loved ones may have to go through the court to gain the ability to make these important decisions. This costs your family time and money at a highly stressful and time-sensitive time.
Protecting Your Assets
Asset protection is the primary goal of estate plans for many people. Estate plans allow you to determine your executors and trustees, who you give the responsibility of distributing your assets according to your will and trust. It also allows you to determine your beneficiaries, who receive the benefits of your estate. Even if inheritance law would place your estate with the right beneficiaries, a planned and comprehensive estate plan can limit inheritance taxes and other expenses for your beneficiaries.
Probate is also a public process. Information about your assets and finances will become public information. When you create an estate plan, you keep your estate private.
Limit Familial Arguments
Without a clear estate plan, the likelihood of family members arguing over your intentions increases substantially. They may argue over small items in your estate or about financial management and real estate ownership. These arguments could even lead to additional court cases.
These issues can be avoided if your wishes are clearly laid out and legally enforceable. An estate planning attorney can help you create an estate plan that accounts for potential familial issues and enacts your interests. An attorney will also ensure that the documents created are legally enforceable.
Q: What Are the 5 Components of Estate Planning?
A: The main components of a comprehensive estate plan include:
- Will: Your will explains how you want your assets distributed and is overseen by the executor.
- Trust: This document designates beneficiaries for your estate. A trust is also what keeps your estate out of probate, as your assets will transfer to the trustee on your death and not the state.
- Durable Power of Attorney: This provides power over financial decisions.
- Medical Power of Attorney: This provides power over medical decisions.
- Medical Directives: This explains your wishes for medical care.
Q: What Are the Three Primary Goals of Estate Planning?
A: The main goals of a comprehensive estate plan are to:
- Protect your assets while you are alive and for your beneficiaries after you pass
- Provide wishes and authority for end-of-life and emergency treatment and care
- Maximize the benefits and minimize the tax and probate costs for your loved ones and beneficiaries
Q: What Is the Most Important Part of Estate Planning?
A: A will and trust is one of the primary aspects of an estate plan, as it designates where and to whom you want your assets and estate given. Even if you have few assets, a legally enforceable trust can ensure that those assets are kept out of probate court. This means your children or beneficiaries can receive the full benefits of your assets rather than wait for the long and expensive process of probate.
Q: What Is the Role of an Executor in Estate Planning?
A: An executor is responsible for enacting the wishes of a person’s will after they have died. They are tasked with identifying and collecting the assets in the will, keeping the estate safe, paying off valid debts the estate owes, filing necessary tax responsibilities, and distributing the remaining assets according to the will’s instructions.
Stange Law Firm: Your Topeka Estate Planning Attorneys
An estate plan can ensure that your wishes are enacted and your family is taken care of, but only if those documents are legally valid. Contact Stange Law Firm today for legal counsel on your estate planning documents.