Advanced Estate Planning: Conclusion
By Steven Merkel
Many people consider estate planning to be a chore that only concerns the wealthy. While it's true that a basic will would suffice for those with few assets, little debt and no dependents, the majority of people require a thorough estate plan. Some elements of estate planning can be complex, such as drafting healthcare and executor directives, which makes hiring the help of an estate-planning attorney (or other financial professional) a safe option for ensuring your last wishes are followed accurately.
Here's a summary of the main topics we covered in this estate planning tutorial:
- An estate consists of all the property a person owns or controls. (i.e. personal property, real estate, bank accounts, insurance policies, business interests, debts, etc.)
- Estate planning also has to consider factors beyond money, such as child care, personal healthcare decisions, payment of outstanding debts, etc.
- Complex estates should be handled by an estate planning attorney, while those with simpler estates can benefit from less-costly estate planning software.
- Because your life is always changing, no estate is every finalized. This makes it important to regularly review your estate plan and make any necessary changes.
- Often only you or your spouse know where your important information is kept (such as banking information, receipts, bills, medical records, etc.), making it important to detail this information for your beneficiaries.
- A will is the rulebook for the distribution of your assets.
- Any person of sound mind and over the state's age of majority can draft his or her own will.
- A healthcare directive is used to name a person to oversee your wishes for medical care should you be unable to make those decisions for yourself.
- The living will details the types of medical treatment you would or would not like to receive under certain conditions.
- A durable power of attorney document is used to give someone the power to make financial decisions for you, should you be unable to make those decisions yourself. This person is known as your agent or attorney-in-fact.
- You can make a list of "powers granted," which limits/enables your agent in regard to what financial decisions he or she is allowed to make.
- Probate court is a state legal process of administering an estate, and it is often costly and time-consuming.
- Your beneficiaries can avoid probate court if you set up a trust document.
- A trust permits you and your successor trustee to transfer assets prior to and after your death.
- A child care document is needed to dictate how minor children will be cared for.
- Your child care document should consider a variety of factors, such as travel restrictions, medical care and a backup plan for your designated guardians, should your original choice be unable to care for your children.
- It is important to review all of your insurance policies to ensure that you are and your beneficiaries are properly protected.
- A final arrangements document should outline your wishes for burial or cremation, ceremonies and any arrangements you may have already taken care of (e.g. burial plot).
- Choosing the right executor is crucial to the proper distribution of your estate. Make sure to carefully select this person, and designate a backup executor in the event that your first choice is unable to fulfill the duties.
A high-level professional service that combines financial/investment ...
A trust that is treated as the beneficiary of an individual retirement ...
The entity that establishes a trust. The settlor also goes by ...
The executor or administrator for the estate of a deceased person. ...
1. A beneficiary specified by an insurance contract holder who ...
An insurance policy provision that allows the insurer to deduct ...
You cannot put your IRA in a trust while you are living. You can, however, name a trust as the beneficiary of your IRA and ... Read Full Answer >>
Once a revocable trust is created, a trust maker transfers funds or property into the trust by including them in a list with ... Read Full Answer >>
A revocable trust and living trust are separate terms that describe the same thing: a trust in which the terms can be changed ... Read Full Answer >>
The main factors that impact share prices in the insurance sector are interest rates, earnings and actuarial risk. In the ... Read Full Answer >>
Insurance policies have deductibles for behavioral and financial reasons. Moral Hazards Deductibles mitigate the behavioral ... Read Full Answer >>
The emerging market economies seeing the strongest growth for the insurance sector are primarily the main emerging market ... Read Full Answer >>