[VIDEO] Estate-Planning 101 - Top 5 Estate-Planning Questions Answered
Estate-Planning Attorney, Steve Thienel Answers the Top 5 Estate-Planning Questions
1. What Is Estate Planning?
Estate-planning consists of much more than drafting a simple will. Estate-planning is the process of developing an advance plan for the management and distribution of your assets after your death. With an estate plan, you can ensure that your final wishes are carried out after your death.
However, estate planning also has several other benefits. With an estate plan, you can protect your property from creditors and the creditors of your heirs. You can also provide income for your heirs during and after your death. Of course, you may also reduce or avoid estate and gift taxes through proper estate planning. An estate plan can also provide for unforeseen health-related emergencies and incapacitation.
2. When Should You Start Estate-Planning?
Ideally, it is best to begin estate planning right after your eighteenth birthday. Young adults may not believe they need to engage in estate planning; however, estate planning can benefit everyone. For instance, a young adult may not have a spouse or children or own many assets, but having a Durable Power of Attorney, Living Will, and Health Care Power of attorney can be very beneficial if the young adult was to become incapacitated for any reason. A parent or agent could act on behalf of the young adult to make financial and medical decisions.
If you do not have an estate plan, the time to begin estate planning is right now. The most valuable benefit of an estate plan is that it allows you to be prepared for unexpected events. While some people may know they will pass away soon, accidents and sudden illnesses can take your life or result in incapacitation within a few seconds. If you do not have an estate plan in place before that time, it is too late, and your family members are the ones left to deal with the aftermath.
3. What Estate Planning Documents Should I Have?
The following is a checklist of the estate-planning documents most people should consider using as part of a comprehensive estate plan:
Last Will and Testament
Durable General Power of Attorney
Durable General Healthcare Power of Attorney
Revocable Living Trust
Living Will and Health Care Directive
Provisions for Digital Assets
Letter of Intent to attach to your will
Appointment of Guardian and Trust for Minor Children
4. How Do I Handle Estate Planning When I Own A Business?
A business owner needs a Business Succession Plan to ensure that the company is transferred or sold according to the owner’s wishes. A succession plan allows you to choose your successor and create a detailed plan for training your successor and transferring the company to your successor upon your retirement, incapacitation, or death. You may also choose to sell the business and distribute the proceeds to your heirs. The key is to invest the necessary time to consider what you want to happen to your business upon your exit from the company now rather than later.
Key elements of a Business Succession Plan include:
· Establish Objectives & Goals
· Create a Process for Decision Making and Communication
· Choose Successors, Identify Their Roles, and Develop a Strategy for Training
· Incorporate the Business Succession Plan into Your Estate Plan
· Consider Selling the Business or Closing the Business
· Address Tax Implications and Strategies
· Obtain a Business Valuation
· Determine Your Exit Strategy for Retirement
An estate planning attorney can help you develop a Business Succession Plan that meets your goals and needs. The process for developing a succession plan may sound difficult, but an attorney can simplify the process, facilitate discussions, and draft all necessary documents.
5. How Do I Choose An Estate-Planning Attorney?
In many cases, hiring an estate planning attorney that is within driving distance is helpful because you may need to make at least two or three trips to the office to discuss, develop, and execute your estate plan. You can begin searching for an estate planning attorney by asking family members, friends, and other attorneys for recommendations. Receiving a recommendation from someone you trust is more valuable than an online review.
However, if you do not have any recommendations, online reviews are a source for evaluating an attorney too, but nothing compares with meeting with an attorney. You may begin by requesting a telephone conference to get an idea of who the attorney is and how the attorney plans to help you. If you feel comfortable, you can schedule a consultation to discuss estate planning in detail.
Because estate planning involves very specific areas of law, it is best to choose an attorney who has several years experiencing in estate planning. You may also want to search for an estate planning attorney who limits the practice to probate-related matters and has obtained additional certifications related to estate planning services.
Do you have more estate-planning questions?
Download the free comprehensive guide - Estate-Planning: 50 of Your Top Questions Answered Here.
Learn the difference between a will and a trust, how to avoid probate, how you can prepare for an appointment with your estate-planning attorney—and more.