Estate planning is a very important part of protecting your loved ones’ future. It is a thorough process of arranging and organizing your assets, financial affairs and personal matters to ensure that your wishes are respected and your family’s financial security is safeguarded. Most importantly, by taking the time to form an estate plan, you can rest easy in the knowledge that everything will be as you wish should the worst happen. You should consider estate planning while you are fit and healthy and review these documents. It is wise to revisit or create an estate plan whenever your personal circumstances change, such as if you get married or divorced .
What is estate planning?
Estate planning is the process through which you determine what would happen to your assets, finances and children if you become incapacitated or pass away. It allows you to decide what and how much of your estate you would want to transfer to your beneficiaries and who those beneficiaries would be. It can also provide you with the opportunity to dispose of your estate in other ways, if you do not wish to simply transfer property to a beneficiary.
What documents make up an estate plan?
There are many components to estate planning, and when you choose a law firm that practices family law in Albuquerque (https://kufferlaw.com/), they will help you to determine which are most appropriate for your particular circumstances and support you throughout the process. What documents are required depends on what type of estate plan is appropriate for you. It could be as simple as a will. It could be much more complicated in which a trust, or several trusts, are established. There are also powers of attorney and medical documents that can be prepared.
Last Will and Testament
This is a key document in which you detail your final wishes. It allows you to record all of your assets, property and financial information and to assign beneficiaries for each element. This is a legally enforceable document that guarantees that your wishes will be carried out in the manner that you specify.
This is the document in which you can appoint an executor. This is the person who will be responsible for coordinating with your legal representative to manage your estate after you have passed away. You can also use your will to specify your funeral arrangements or other postmortem details, easing the burden on your dependents.
A will can be used to assign money or assets as gifts or charitable donations in order to reduce the inheritance tax bill that your beneficiaries might otherwise be required to pay.
A living trust allows you to formally transfer assets or wealth to a group of designated individuals, known as trustees, or a single trustee, who will hold and safeguard them for future distribution to your chosen beneficiaries. A living trust allows trustees to take control of your assets if you become unable to handle your affairs or die and allows them to manage your estate in a way that you would like.
It is possible to have a living trust and a last will and testament. You do not want there to be discrepancies between the two, which would force your survivors to ask the Court to determine which document controls regarding a particular issue. Therefore, it is essential that both documents are reviewed any time changes are needed to ensure that they align.
Advance Healthcare Directive
You may choose to enact an advance healthcare directive which allows you to specify your medical preferences and appoint a trusted person to make healthcare decisions on your behalf in the event that you are unable to do so.
An advance healthcare directive allows you to specify your preferences when it comes to resuscitation, artificial feeding or breathing, et certera. It also allows you to specify how you would want your long-term care needs to be met if you develop a serious or degenerative condition in the future. Advance Healthcare Directives are extremely useful if you wish to avoid a situation where friends and family are left to care for you at the end of your life but do not know how you wish to spend those last moments.
Power of Attorney
Power of attorney is the process through which you designate a third party to act on your behalf. You can either assign them as your power of attorney to handle all of your decisions in the event that you become incapacitated in the future or specify the types of affairs that they are entitled to deal with regardless of your mental or physical capacity.
For example, a business owner may assign a certain person to act as a power of attorney to act on their behalf in specific financial or business transactions, while others may assign a power of attorney to handle their financial affairs only if they are hospitalized. You may also appoint someone to act on your behalf generally so they are able to make almost all decisions on your behalf.
Your family attorney will help you determine which documents are most appropriate for your particular situation and ensure that they are written, witnessed and legally enforceable.
The bottom line
Estate planning is an important legal function that should be carried out sensitively and compassionately. It is never easy to think about a future that we are not a part of, so when you choose the Law Office of Dorene A. Kuffer to handle your estate planning needs, you will benefit from our experience and empathetic guidance as we guide you toward a solution that protects those that matter most to you.