Estate planning is not only helpful to the wealthy. Everyone can benefit from some basic estate planning. But it can be very confusing, and you can easily become overwhelmed. Estate planning attorneys will help you customize your plan and will explain and advise you about the various options you have when planning your estate. What follows is an estate plan checklist you can use to help you gain a basic understanding of estate planning and how it can help you.
1. Take Care of the Basics
There are a few basics that your estate plan should include:
• A plan that identifies what happens in the event of–not only death–but disability too.
• A good plan will also address the financial security of your family, what you want to happen to your property upon your death, and how to avoid or lessen estate taxes. If you have minor children, you should make that a part of your estate plan as well.
2. What Happens to Your Assets
This is the most common thing people think of in estate planning. Some things to consider are:
• Assets with title documents such as real estate or vehicles cane automatically pass to a co-owner likely a spouse). Have your attorney check how the ownership is titled.
• A mistake there could create a lot of headaches down the road. Also review the amount of the property to avoid a federal gift tax.
3. Don’t Forget to Cover Your Debts
All of your debts, including burial expenses can be paid through homeowner, auto, life insurance, and disability. This will ensure that your loved ones are provided for.
4. Determine Beneficiary Designations
For some assets you can choose who will receive the property upon your death. The documents used may include the “pay-on-death” or POD and also the “transfer-on-death or the TOD.
5. Prepare Your Last Will and Testament
A last will and testament is an important part of your estate planning. A last will and testament takes care of any property that must be probated. A last will can also deal with the care of any minor children as well as or adult children with disabilities. Property that was not held through joint ownership or a beneficiary designation, can also be assigned. This is the time to name an executor of your estate, and to choose someone to be the guardian of your children.
6. Power of Attorney– Two Types
There are two types of Power of Attorney (POA) that you should consider. The first is a Financial POA, which allows you to name someone to act on your behalf in financial matters. authorizes someone you trust to act on your behalf in financial matters. The second is a Health Care POA who will make decisions regarding your medical treatment in the event you are mentally or physically unable to make decisions for yourself.
7. A Living Trust Should Be Considered
A living trust is a document that helps to avoid probate and lessen estate taxes. To avoid probate, most people create a revocable living trust or an irrevocable living trust. Your attorney can help you decide which is right for you.
8. Create an Advance Directive or Living Will
A living will, also known as an advance directive, states your wishes in the matter of life-prolonging treatment you do or do not want if you become terminally ill or injured and cannot communicate. Be sure to inform your Health Care POA that a living will has been filed.
9. Prepare Detailed Information for Your Executor
The purpose of this document is to make it as easy as possible for your executor and loved ones to carry out your wishes. It should include:
• Information to identify and locate financial accounts, vehicle loans and titles, insurance policies, credit cards, and mortgage statements;
• Contact information for those people who are to be notified of your death;
• The physical or virtual location of all your assets such as safe deposit boxes, location in the home or storage units. You should also consider giving your executor your online accounts and password information
• Your wishes regarding burial, cremation, funeral ceremonies, organ donation, etc.
The Law Office of Arnold N. Hirsch makes estate planning simple and affordable. You can get more detailed information here, or call the Law Offices of Arnold N. Hirsch at 480-832-3000 for a consultation. With over 35 years of experience in Arizona law, we’ll be there to make sure your wishes are carried out and your loved ones are taken care of in the manner you wish.