What do we include in our Estate Planning Portfolio?
As you dive into estate planning, you’ll find a few different terms pop up such as will, last will and testament, trust, revocable living trust, and living trust. Read on to learn the definitions of each:
This document is used to help you carry out how you want your assets and properties to be distributed and is one of the most well known terms in estate planning. Everyone should have a will in order to avoid their assets going into probate.
The will is a document that declares the intentions of the deceased to bequeath money and property to specific persons after death. Possessing a will does not avoid probate, as some may believe, but a well-designed will can ensure a smooth and efficient probate process that doesn't draw on the resources of the estate while it is executed in probate. Enlisting the help of an experienced probate attorney can help to guarantee that a will is executed as intended in probate.
The living will speaks to healthcare – it’s the document in which you note how you want your medical care handled in the event you are no longer able to declare it for yourself.
Last Will and Testament
This is a legal document that notes your assets, properties, and where and how they will be distributed when you die. The last will and testament has also been called a will.
A trust is a legal instrument designed to shield assets from passing through probate court and coming under the control of estate law. Proper trust administration can ensure that assets are not subject to the estate tax, nor are they held in probate for months after one's passing. This is possible because the assets in question are legally transferred in life from their original owner to the trust, though this can easily be written so that the owner can revoke it at any time. Trusts are an excellent way to smooth the estate administration process and avoid the majority of probate litigation, and have helped many provide a safety net for their loved ones.
As opposed to wills, trusts can be used to divide up your belongings while you are still alive. You write the rules of it. Your trust can have multiple beneficiaries, but our clients in Michigan typically site two.
Revocable Living Trust
This legal document is used to avoid court supervised process of wrapping your estate – also known as ‘probate.’
Like the name suggests, a living trust is a type of trust. It’s used to avoid probate and guarantee that in the event you become ill or for any other reason are unable manage your own assets, they will be used in a way that best benefits you.
General Durable Power of Attorney
A financial power of attorney is a document that is used to name someone to take financial and legal action on your behalf. Absent granting this authority through a power of attorney, your loved ones will likely need to petition the court to be appointed your conservator…costing both time and money. These documents can grant this power immediately, or only after your disability or incapacity when you need someone to act on your behalf.
Health Care Power of Attorney/Patient Advocate
A power of attorney for healthcare can nominate a patient advocate to make healthcare decisions on your behalf. Without the authority granted in this document, your loved ones may need to petition the court to be appointed your guardian…again costing time and money.