Estate Planning

A common misconception is that estate plans are primarily for the wealthy.  This could not be further from the truth.  No matter what stage of life you're in or what your economic status is, you need an estate plan. At a minimum, every adult should have the following documents:

 

• Will - This document dictates how your assets will be distributed upon your death and who handles the process.

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• Durable Statutory Power of Attorney - A Durable Power of Attorney is a written instrument designating an individual to serve as an agent to make various legal decisions when you are incapable of making or communicating such decisions yourself.

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• Medical Power of Attorney - A Medical Power of Attorney is a written instrument appointing an agent to make health care decisions when you are incapable of making or communicating such decisions.

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• Directive to Physician - A Directive to Physicians, also known as a living will or a do not resuscitate order (“DNR”), is a written instrument directing your physician as to whether or not you want to artificially prolong your life when death is imminent.

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• HIPAA Release - Congress passed a law entitled the Health Insurance Portability and Accountability Act (“HIPAA”) that limits disclosure of protected medical information. This authorization is necessary so that medical providers will readily give protected medical information to any family and/or friends designated by this authorization. 

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At our firm, we take the time to understand our clients' financial and family situation and discuss all options related to estate planning. Only after we have a clear picture of your concerns and your wishes do we build your comprehensive estate plan.

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And, even if you have a will package, it may not include all of the above documents, or it may be time to update these documents to reflect your current family situation. So, we encourage you to contact our office to schedule a review of your estate plan. To help get the process in motion, please download and complete the questionnaire below before we meet. Of course, please feel free to call the office if you should have any questions regarding the process.

 

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​Revocable Living Trust

 

A will is the usual method for passing your estate to your beneficiaries, but another viable option is the utilization of a Revocable Trust.

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A Revocable Trust is comprised of 3 positions. A Grantor/Settlor, the creator of the trust. A Trustee who serves as the administrator and the legal title holder of the trust and its property. It is not uncommon for the Grantor to serve as the initial trustee, And, finally the Beneficiaries. 

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The basic premise, for use of a Revocable Trust, is the retitling of the assets of the estate in the name of the trust before one passes. This process is called funding the trust. A properly funded trust essentially bypasses the need for the probate of a will. The reason for probate is to retitle assets and pay debts. With a Revocable Trust, the assets are retitled and there is a trustee already in place to settle estate matters upon the passing of the Grantor.  Upon death, the trust dictates distribution of the assets just like a will but without the need for probate.  

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Another benefit of the trust is that because the assets are re-titled in the name of the trust before the Grantor's death. this retitling ensures that the trustee has access to the funds in the event the Grantor becomes incapacitated. Potentially, this allows for the care of the Grantor without the imposition of a guardianship upon the incapacity of the Grantor.

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To Summarize:

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Advantages of a Revocable Trust 

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• It is revocable. The assets that have been retitled into the trust can very easily be removed from the trust by retitling during the life of the Grantor.

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• It avoids probate. If all assets are retitled into the trust before the death of the Grantor, then there is no need to probate the estate. A side benefit, to not having to probate, is privacy. No probate means there is no public record of the settlement of the decedent’s estate.

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• It avoids guardianship. While this statement is not absolute, if the assets have been retitled and there are other instruments such as medical power of attorney and a HIPAA document in place, it is likely that the trustee can care for the Grantor without having to utilize a guardianship.

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Disadvantages of a Revocable Trust 

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• It is time-consuming to retitle all assets.​​

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• Initial costs to create a trust is higher than drafting a will. 

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• One must fund the trust.  An unfunded trust requires that the estate be probated. In the event the Grantor dies without retitling all assets there will be a need for probate to retitle the assets left out of the trust, using a pour over will. This type of will is drafted to ensure that any probated asset is “poured” into the trust to be distributed in accordance with its terms.