An estate plan is a set of documents that can help you protect your assets and ensure that your wishes are fulfilled after you pass away. It typically includes a will, guardianship designations, power of attorney for health care, designations of beneficiaries, a durable power of attorney, and a personal letter of intent that describes your wishes in the event that you die or become incapacitated. In addition to living trusts, there are also irrevocable trusts to protect certain assets that you may want to irrevocably reserve for your chosen heirs. These assets are protected from your creditors and the creditors of the beneficiaries, and can be used legally and legitimately to minimize wealth taxes.
However, it is important to consider the irrevocable nature of these trusts. COODIN & OVERSON, PLLP helps clients who want to formulate and document their estate plans. A common misconception is that only wealthy people need wills or trusts. In fact, a will or trust is a crucial part of any estate plan, whether you're wealthy or have modest resources. A will or trust will direct the distribution of your estate (all your assets and liabilities) after your death, in accordance with your wishes.
A will can also name a guardian for any child you have who was not at least 18 years old at the time of your death. Each of us has a complicated web of financial and legal responsibilities to deal with on a daily basis. We pay bills, manage bank accounts, sign documents, and perform any number of other ordinary, but important tasks. If we are unable to perform these tasks due to illness, injury, or death, chaos can ensue. Bills won't be paid, deposits won't go to our accounts, and liabilities won't be met.
However, a durable power of attorney allows you to appoint a person you trust to handle your financial and legal matters if you are unable to manage them yourself, either temporarily or permanently. Like a permanent power of attorney, a medical power of attorney, sometimes called a health care power of attorney, allows you to authorize a person you trust to make decisions about your health care if you can't make those decisions for yourself. Having a living will or an advance health care directive does not preclude the need for a medical power of attorney, as situations may arise that are not addressed in the living will and will require the person you have appointed to make the decisions.
Understanding Key Concepts in Estate PlanningIt is important to understand the key concepts involved in estate planning in order to create an effective plan. This includes understanding wills, trusts, probate, power of attorney, and how to avoid estate taxes. Because relationships and family dynamics can change over time, failure to modify the estate plan can cause assets to pass into the hands of people that the person no longer wants them to pass into the hands of people.
To ensure that your wishes are fulfilled and that your loved ones are protected, let Dworken & Bernstein help you create a comprehensive estate plan. Estate planning is a way to ensure that your property and other assets are distributed according to your wishes. It's important to review your estate plan from time to time (we recommend an annual review) and document any changes you need. A good plan should be designed to avoid probate proceedings, save on estate taxes, protect assets if you need to move to a nursing home, and designate someone to act on your behalf if you become disabled.