People think Estate Planning is complicated and too expensive. Estate planning takes courage because it requires thinking about what is going to happen after you die which many of us are afraid to do. It requires putting the best interests and peace of mind of those you love over the fear and denial of death. It requires being proactive now, spending some money to make sure it is done right and then just forcing yourself to think about it, do it, protect everyone and forget about it for the rest of your life.
What is Estate Planning? Your Estate is the real and personal property (including money things like savings, stocks and bonds) and any other asset of any kind that you own at the time of your death. Estate planning mechanisms are different “tools” that lawyers use to “fix” specific potential problems that may arise with a decedent’s estate. Estate Planning is also used to protect and maintain a person’s independence and finances if they become legally incompetent or otherwise unable to to make informed decisions concerning their medical or day to day care.
Estate planning is also a mechanism by which you give your assets to specific people or organizations after you die. It is the way you make sure your property goes to the people you want it to go to after your death. It is also a way that you can control how those assets are utilized and at what age they are distributed to your heirs (especially, if they are currently children or very young, or irresponsible, or have substance abuse or other issues which could rapidly deplete your estate). You cannot do this with just a will. All you can do with a will is give things to people after your death and they can do whatever they want with the assets. A will is not a tool that you can attach any conditions as to how it should be spent or at what age it should be distributed. A will is also a matter of public record, whereas a trust is not.
A will is still an important estate planning mechanism but it’s use should be limited only to assets which, for whatever reason, were not put into the trust. Hiring an attorney who is a good and detailed will drafter is essential. The sixty dollar will you get off the internet could wind up costing your beneficiaries sixty thousand dollars in legal or accounting fees to straighten up the details that were not covered. These documents, contrary to the public perception, require skill, experience and professional expertise to avoid potentially serious problems to your loved ones after your death. A person needs to be able to call someone who can answer questions and offer guidance through the process. When you purchase legal documents you are really paying for an ongoing professional relationship with an attorney.
There are many contingencies that need to be thought about and included in your estate plan that need to be specifically drafted based upon one individual client’s specific needs. Designing an effective estate plan, contrary to the public perception, is a specific skill set which grows with the drafting and professional experience of the practitioner. I do not say this for the sake of getting business but because I have seen my share of costly, stressful disasters that were caused by nothing more than poorly detailed, over drafted generalized “form” language. It is always very disheartening for me to see this because the client did the right thing but was let down by the legal system either through negligence or bad forms. Estate planning is a detailed discipline. The reason you need a good estate planning attorney is to develop an overall effective estate plan based upon your individual estate, family situation, business situation and specific goals.
There are many things which can and should be passed on through means other than a will (Real Estate is a prime example). The reason is that property passed through a will has to go through probate. Probate is the process by which the court ensures that your estate is distributed according to your will or distributed according to state laws if you die without a will. Probate also makes sure your debts are resolved. The problem with probate is that it is costly (pretty high attorney fees), takes a long time and is a matter of public record. The biggest problem is that in probate there are no checks and balances on how fast your heirs go through your money or how it is being spent. It is not unusual for heirs to spend large inheritances in very short period of times with nothing to show for it.
Our firm uses a combination of wills, trusts, transfer on death deeds, payable on death designations and specific powers of attorney (to name the most common) to design estate plans to save money, simplify the legal process and promote peace of mind for both the client and her or his heirs. Further, the estate plans we create maintain secrecy while expediting the quick and inexpensive transfer of assets.
It is also important to put planning mechanisms in place that will ensure that someone you love can care for you, and will be your guardian while you are still alive in the event of sickness, disability or coma. Without this, the court may appoint it’s own guardian. Durable General Power of Attorney’s and Health Care Power of Attorneys are Estate Planning instruments which are different types of powers of attorney that give a loved one legal authority to manage your health, business and financial affairs if you are unable to do so yourself. Finally, you should make sure that your wishes concerning whether your life should be prolonged through artificial means in the event of irreversible coma or other physical debilitation are spelled out and medical providers are given the instructions and authority they need to carry those wishes out. You do not want to put this burden on your loved ones.
Estate planning is one of the greatest acts of love that one extends to their family and heirs. It is the way by which you relieve your family, children, friends, and loved ones from having to resolve your business and financial affairs and all the mess and expense that comes with it. It also relieves them of the burden and pain of having to guess (or fight over) your intent as to how you wanted your property distributed, and, in some cases, even decide your wishes and make decisions concerning your life and death.
A comprehensive estate plan for most people is not that expensive and can be prepared and completed pretty fast. Our total cost for a Simple Will, General Durable Power of Attorney, Health Care Power of Attorney, Living Will, Consultation and ongoing attorney phone support is $500. The cost of a detailed, professionally drafted trust with ongoing professional support averages between $1000- $1500. However, the value in peace of mind and security you will have in knowing that this is done for your family is priceless. Moreover, all of our estate planning work is done on a fixed rate fee basis so the client does not have to worry about hourly fees.
A trust is the only way to totally avoid probate, and control how your money is used after death. There is nothing more powerful than a trust for exercising control from the grave. It is a wonderful tool to make sure your intent is carried out. It is one of the most inexpensive ways to promote peace of mind. Preparing these documents now will save your loved ones much confusion, difficulty, time and, potentially, many thousands of dollars after your death. This simple, cost efficient estate planning is all that most people will need and it will provide peace of mind, and avoid family disputes over your assets. Planning your estate will, ultimately, be your last act of love toward your family and other loved ones..
Robert C. Biales