11 Aug Don’t I Just Need a Simple Will?
Estate Planning Overview – Don’t I Just Need a Simple Will?
Estate planning is a process that allows you to provide for the management of your assets when you are no longer able. Good estate planning is more than just a simple will. While a simple will may be easy to implement, it often falls short when discussing estates with assets, such as a home, investments, business, life insurance, employee benefits (such as a 401(k) plan) or other property. Proper estate planning allows you to minimize potential taxes and fees and ensures your wishes are followed after incompetency or death. On the health care side, a good estate plan includes directions to carry out your wishes regarding health care matters, so that if you ever are unable to give the directions yourself, someone you select would do that for you.
A Will governs the disposition of assets which are owned by you at death. Specific bequests of tangible personal property can be made via the will or a memorandum attached to the Will. All other property is either bequeathed to your heirs or “pours over” to a trust. The Will is “Probated” upon your death in the County in which you reside at that time. The Probate Court insures that probate assets are collected, maintained and distributed among your heirs according to your Will. This process is known as the administration of decedent’s estate.
Certain other property is not governed by the Will, rather, the distribution of such property will be governed by operation of law or contract. For example, property held in a joint tenancy with a right of survivorship (e.g., real estate, bank/brokerage accounts) will pass to the designated survivor by operation of law. Property subject to a contract (e.g., life insurance, IRAs, and retirement plans) will pass to the designated beneficiary. Contract properties also include property titled in the name of or otherwise owned by a trust. In this case, the trust document or contract, rather than the Will, governs the distribution of such property. If it is your desire to avoid the necessity of having your assets subject to probate administration at the time of your death and thus be a public record available to everyone, assets should be transferred or acquired in the name of a trust.
While setting up a living trust will probably cost more initially, rather than a simple will, it will allow you to avoid probate, give you more control over the distribution of your assets after your death and prevent possible court control of your assets during incompetency.
Wills and trusts take on an added importance if you have young children. This is because they not only name the guardian for your children but also determine how your children will inherit your estate. If you simply name your minor children as the beneficiaries of your will, they will inherit outright. A better way is to make sure that any assets inherited by children go into a trust. This will enable you to ensure that money is available for your children’s benefit and only given to your children at an age you have specified.
In addition to a Will and possibly a trust, you should have a durable power of attorney in place as well as health care directives. The Durable Power of Attorney appoints someone you trust as your attorney-in-fact. If you are unable to act, say for example due to incompency, your attorney-in-fact can act in your stead.
Health Care Directives consist of a Living Will and a Health Care Power of Attorney. The purpose of a Living Will is to document your wish that life-sustaining treatment, including artificially or technologically supplied nutrition and hydration, be withheld or withdrawn if you are unable to make informed medical decisions and are in a terminal condition or in a permanently unconscious state. The Living Will does not affect the responsibility of health care personnel to provide comfort care to you. Under Ohio Law, a Living Will is applicable only to individuals in a terminal condition or a permanently unconscious state. Your Health Care Power of Attorney directs medical treatment in other circumstances. If you are in a terminal condition or a permanently unconscious state, the Living Will controls over a Health Care Power of Attorney. The Health Care Power of Attorney gives the person you designate (the attorney in fact) the power to make most health care decisions for you in you lose the capacity to make informed health care decisions for yourself.
Everyone needs an estate plan. It does not matter if you are old, young, married, single, a parent or if you have no children. Whether you are wealthy or not it makes sense to invest in an estate plan. There is a lot to be gained by you and the ones you love through estate planning. There is even more that can be lost by failing to take the time to make an adequate plan. Proper estate planning will avoid the turmoil and wasted assets of an unplanned estate. Remove the uncertainties and give yourself and your loved ones the sense of security that is deserved.
Estate planning even in the simplest of situations requires a significant amount of attorney expertise and gathering of background information. An estate planning attorney will gather information to assess your overall goals and needs, determine the property and asset situation, and identify any unusual circumstances you might have. Estate planning attorneys are trained to look not only for red flags, but also to provide guidance in making the difficult yet important decisions needed even for the most basic plan. Too often what seems straightforward contains some issues that can only be resolved with experience and training of an attorney. Any do-it-yourself estate planning via the internet or form documents that are one-size-fits-all, will fall short in these areas.
For more information on these and other estate planning principles, please contact Attorney Jacqueline Ferris MacLaren, MacLaren Law, LLC, at (614) 402-4724 or firstname.lastname@example.org. This information is designed to provide a general overview with regard to the subject matter covered and is not to be construed as legal advice.