There are many types of beneficiary designations and all should be consistent and revised periodically. A general POA becomes void when you die or become incapacitated and is therefore useless for estate planning. A durable POA is initiated when you die or become incapacitated and allows your attorney-in-fact to carry out your wishes for your assets. Power of Attorney (POA) allows someone else to make financial (and sometimes medical) decisions for you. Your death will then initiate the trustee to disperse the assets following the directive of your trust. The trustee will officially hold the deed to your assets, but you will keep earning off them and managing them until you die. A revocable living trust will put your assets like property or business holding into a trust where you become the grantor and you name someone else or an attorney to become the trustee. If you wish to avoid probate, you should set up a revocable living trust. If you only have a will, all your assets will still have to go through probate. Not all of these will apply to everyone, but you should at least be familiar with them: Last Will and TestamentĪ will, simply states what will happen to your assets after you die and who will be named the guardian of any minor children. Estate plans can dramatically reduce the time and cost of this process.Īs you start thinking about your plan and compiling information, there are a number of estate planning forms you may need to fill out. Reduce family strife: If you have a clear and legally-bound plan in place when you die, it will reduce the amount of family in-fighting that can occur after your death.Īvoid Probate: When a person dies, their assets go into probate where a court decides upon your beneficiaries. Not all of these are avoidable, but if you set up a living trust as part of your estate plan you can reduce their effect. Reduce or avoid taxes: Some of your assets may be subject to federal or state estate tax, inheritance tax, or gift tax. A well-written out estate plan can mostly avoid this. Privacy: Without an estate plan (and ideally a living trust as well), your assets will go into probate upon your death and all of your estate information becomes publicly available. This will take extra care and preparation to find the right person, but your choice will ensure lasting care for your loved one. Protect special needs family members: You can also name a guardian of a dependent adult child. Peace of mind: Even if you won’t be leaving behind a lot of money, you’ll know that your assets are allocated just the way you wanted.Īppoint a guardian: If you’re the parent of minor children, you’ll get to decide who becomes their guardian instead of the courts, and can plan ahead to ensure they will raise your child the way you want them to.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |