Estate Planning is an integral aspect of life. It is not something to be left for the chosen few, but instead should be done by each and every individual. Knowing that no one in this world will escape the hand of death, we should all purpose to exit comfortably by ensuring that those whom we leave behind are fully aware of all possessions we had in our name. You may wonder whether you really have any asset or estate. The truth is, we all have something we can claim to be ours. It may not be a row of apartments in one of Los Angeles’s leafy suburbs or a fleet of lamborghinis. Even the clothes well arranged in your closet serve as assets. In case you were to die today, it is in order for you to have planned how your clothes should be disposed of, whether to donate to your favorite charity or pass them down to your sibling. A simple fact is that no one will take their possessions with them to the grave. That is why planning in advance on how they should be handled after your demise is essential. Estate planning can therefore be described as thorough guidelines outlined by an individual which state who is to receive which possessions and how their assets ought to be distributed upon their demise. Estate planning is a gradual and thoughtful process which takes into consideration several aspects. Why Is Estate Planning Important?Some of us have grown up thinking that estate planning is only done by the elderly population who are in their sunset years. However, that is considered a great misconception. No one is guaranteed of tomorrow, therefore estate planning ought to begin as soon as you become an adult. We can blame this misconception on a lack of awareness on our part as citizens. That is okay. Nevertheless, times have changed and we thrive in an information era. Knowledge has immensely become accessible. It is therefore imperative for us to educate ourselves on life matters such as estate planning. Importance of estate planning can be summarized as follows:
Estate Planning DocumentsEstate planning is a continuous process which requires various avenues for making the entire journey easier for you. There are necessary paper works which are normally involved in estate planning. You may have come across some of them at one point in your life. Even if you are unfamiliar with these documents, feel free to read about them below. Power Of AttorneyIn legal matters, a power of attorney is a lawful authority that is handed to someone (agent) to handle any legal matters on behalf of the person (principal). The agent performs any legal duties given by the principal on effect that the principal has been rendered incapable through death, a mental illness or old age. However, a power of attorney is restricted to carry out various tasks. Depending on the state you live in, the power of attorney cannot alter or create your will without your consent. It is important to note that there are several types of power of attorney. Each type serves a different purpose based on the prevailing circumstance. In estate planning, there are two commonly used powers of attorney; the financial power of attorney and the healthcare power of attorney. Financial Power Of AttorneyThis legal document gives an agent the right to oversee your finances. You can nominate an individual or an institution such as a bank to have the financial power of attorney. Each state in the United States has an official financial power of attorney. As such, your power of attorney should be customized around the laws of that particular state you have obtained it from. This document can either come as a durable financial power of attorney or springing financial power of attorney. The durable one simply means that once the two parties append their signatures on the document, it immediately becomes effective. The agent is now able to oversee your financial matters even if you are still mentally capable. This may occur in instances where you are out of the country or your spouse is also unavailable. On the other hand, the springing financial power of attorney only comes into effect after the occurrence of an unfortunate event that renders you incapable. An agent can oversee financial issues such as: transacting with your financial institution; collecting revenue from your business; verifying your tax payments; collecting any debts owed to you; opening of accounts; following up on any state benefits like social security and ensuring that payments on mortgage, car or property is paid on time. Healthcare Power Of AttorneyAs we have seen above, a power of attorney is necessary due to an uncertain future. Incapacitation may occur as a result of medical causes. Common cases include mental illness, debilitating diseases such as Alhziemer’s or dementia or a permanent brain injury. Such ailments can render you mentally incompetent to make any sound decisions regarding your estate division. A healthcare power of attorney comes in handy in case of such events. This document is effective as it allows the principal’s wishes to be carried out. It gives guidelines on how you would want your medical concerns to be handled. Maybe you do not desire a dialysis or physiotherapy and instead wish to be allowed to die. This information is normally indicated on the healthcare power of attorney. This document also indicates any consent you give. You may give, withdraw or refuse consent on a particular medical regimen you are undertaking. Importance Of Having A Power Of Attorney
TrustsTrusts serve as a crucial aspect of estate planning. A trust is best described as an association formed by a trustor or someone who entrusts their assets to a second party called a trustee to manage them. The trustee is given legal rights to the assets in play. This is done while the trustor is still alive. A trust can either be revocable or irrevocable. In a revocable trust, you as the grantor still has full control to your property. You can freely amend any component in it. On the other hand, the irrevocable trust grants the trustee all privileges of managing the assets. Incase an amendment is necessary, all involved parties have to agree first. There are specific rules outlined in a trust document which must be followed by the trustee. Choosing an administrator can be daunting as you need to ensure that your trustee has your best interests while serving you. As such, as a grantor or trustor, you have the right to terminate the services of your administrator if they break the rules or have a conflict of interest. A trust is a crucial document in estate planning as it can save the entire family the exhausting judicial process of seeking to establish whether the deceased had divided their estate before their demise. Importance Of Having A Trust
Last Will And TestamentAs someone who has worked hard to secure a decent lifestyle over the course of your life, it is only fair to ensure that upon your demise, any form of asset you had acquired is left to keep your legacy alive. Writing a will guarantees just that. Drafting a will is not rocket science as most of us believe. With the aid of simple guidelines, you can easily draft one on your own without having to hire an attorney. A written last will and testament gives a clear overview of all your estate, assets or liabilities. It describes who should receive which asset. It also lists all your beneficiaries, from children, friends, charities and relatives. One does not need to wait until old age sets in to draft one. It is advisable to always have one at hand. Even after accumulating more wealth later on in life, you can still make amendments to the original will. Failure to write a will while you are alive leaves your beneficiaries at the mercy of the laws governing your country which will decide how to distribute your estate upon your death. This is known as dying intestate. While writing a last will and testament, consider the following:
Importance Of Having A Last Will And Testament
The above listed documents play a vital roll in all your estate planning procedures. It is advisable to contact a legal expert or you can ask for assistance in any issue you may not understand. No one has to die intestate as this is a recipe for conflicts and mess among thee loved ones involved. Estate Planning Attorney Free ConsultationWhen you need your estate plan completed or updated, please call Ascent Law for your free consultation (801) 676-5506. We want to help you.
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Should I Get A Divorce Or An Annulment? Is Mediation The Best Route In Divorce? via Michael Anderson https://www.ascentlawfirm.com/what-estate-planning-documents-do-i-need/
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