FAQs

This is the most common form of asset ownership between spouses. While joint tenancy has the advantage of avoiding probate at the death of the first spouse, it often has unintended consequences. Joint tenancy with the right of survivorship has the effect of transferring assets, apart from how a will or revocable trust directs. Also, a parent should be careful not to put their child’s name on their account. Doing so may subject their accounts to loss through their child’s debts, bankruptcies, divorces and/or lawsuits. Joint tenancy planning also may result in unnecessary death taxes on the estate of a married couple.

The document a person signs to provide for the transfer of assets after death. Wills do not avoid probate. Wills have no legal authority until the will maker dies and the original will is admitted into the probate court records. Everyone with minor children should have a will or a Declaration of Guardian for Minor Children. These are the only two ways to appoint the new “parent” of an orphaned child. Special testamentary trust provisions in a will can provide for the management and distribution of assets for your heirs. Additionally, assets can be arranged and coordinated with provisions of the testamentary trusts to avoid estate taxes.

Sometimes called an advance medical directive, a living will allows you to state your wishes in advance regarding what types of medical life support measures you prefer to have or have withheld/withdrawn if you are in a terminal condition (without reasonable hope of recovery) and cannot express your wishes yourself. Oftentimes, a living will is executed along with a durable power of attorney for health care, which gives someone legal authority to make your health care decisions when you are unable to do so yourself.

If you die without even a will (intestate), the legislature of your state has already determined who will inherit your assets and when they will inherit them. You may not agree with their plan, but roughly 70% of Americans currently use it.

You may avoid probate on the transfer of some assets at your death through the use of beneficiary designations. Laws regarding which assets may be transferred without probate vary from state to state. Some common examples include life insurance death benefits and retirement accounts. Since beneficiary designations go around what the provisions of a will or revocable trust direct, they often have horrendous, unintended consequences.

These allow you to appoint someone you know and trust to make your personal health care and financial decisions even when you cannot. If you are incapacitated without these legal documents, then you and your family will be involved in a probate proceeding known as guardianship and conservatorship. This is the court proceeding where a judge determines who should make these decisions for you under the ongoing supervision of the court. Guardianship is time-consuming and expensive. Even with a durable power of attorney, guardianship is often still required. A revocable living trust can completely avoid guardianship.

This is an agreement with three parties: the trust-makers, the trustees (or trust managers), and the trust beneficiaries. For example, a husband and wife may form a trust and they will be all three parties, creating the trust, managing all the assets transferred to the trust, and having full use and enjoyment of all the trust assets as beneficiaries. Successor trustees can step in under the terms of the trust to manage the assets should the couple become incapacitated or die. The trust also controls the management and distribution of assets to the family upon the trust maker’s death. With proper planning, the couple can also avoid or eliminate estate taxes on their estate. The revocable living trust may allow them to accomplish all this outside of any court proceeding.

Whether you are young or old, rich or poor, married or single, if you own titled assets such as a house and want your loved ones to avoid court interference at your death or incapacity, consider a revocable living trust. A trust allows you to bring all of your assets together under one plan.

When people hear the word “estate,’ they usually imagine a large home with ivy growing on it, perhaps with a maze garden in the backyard – something that has been in a wealthy family for generations upon generations. However, with respect to estate planning, an estate is the general term used to describe everything you own. This includes bank accounts, stocks, real estate, household items and furniture, automobiles, copyrights, and cryptocurrency. This also includes liabilities such as a mortgage, lease or loan.

An estate plan is your personal set of instructions that dictate what will happen to you and your stuff (your estate) at your death. If you have a minor child, your estate plan allows you to nominate who will be the guardian for your child. Estate planning documents also allow you to dictate who manages your finances when you cannot and who will make medical or end-of-life decisions when you are unable to communicate them yourself. Some common documents that are part of an estate plan include a last will and testament, financial power of attorney, medical power of attorney, advance directive or living will, and Health Insurance Portability and Accountability Act (HIPAA) authorization form.

Technically, you already have an estate plan. If you do not create a personalized estate plan, state laws dictate who will receive your money and property, and the amount each heir will receive. Intestacy laws vary by state, but generally, your money and property will go to your nearest blood relative; that is, your children, grandchildren, parents, siblings, nieces and nephews, and so on. If you are married, most states provide that your spouse will get everything, provided that any children you have are from that marriage. If you have a blended family, the default rules are a lot more convoluted.

Additionally, without a personalized estate plan, the court will step in and appoint someone to make financial or medical decisions on your behalf when you are unable to decide, whether or not you would have chosen that person yourself. This process can be incredibly time-consuming, expensive and public.

As you begin the estate planning process, you may find that the cost of having a comprehensive and personalized estate plan prepared by an attorney is a little more than you expected. Consider, however, that this cost can be significantly less compared to the court costs and attorneys fees your loved ones will incur to arrange care and choose decision-makers at your incapacity or to wrap up your affairs at your death without an estate plan.

Yes, but a word of caution: while there are several do-it-yourself options available on the internet or at your local library, completing these documents without the advice of an experienced attorney could leave your loved ones in a sticky situation if something should go wrong. First, an estate plan is more than just one document. To make sure that you and your loved ones are protected no matter what circumstances come your way, several documents may be needed, and they all must sync together and not contradict each other. Second, if you get something off of the internet, there is no guarantee that the document will conform to the specific rules of the state you live in. Third, the document you prepare may not address all of the possible situations that occur or change in your life, nor is it likely to take into account your specific family situation or goals. Forms are basic and are meant to address the most common scenarios. Lastly, creating an estate plan yourself could lead to mistakes in the execution of the documents. Even if your documents explain everything perfectly, if they are not executed (that is, signed, witnessed and notarized) correctly, your loved ones will have additional hurdles to overcome in trying to carry out your wishes, which will cost them money. So even though you may be saving money today, your loved ones could end up spending more (in money, time and stress) when wrapping up your affairs if you utilize some of these cheaper alternatives.

Estate planning is a very personal process. Therefore, the first thing you should look for in an estate planning attorney is someone you are comfortable with. To properly plan for you and your loved ones, you may need to divulge sensitive information. If you are uncomfortable discussing with the attorney your family situation, financial matters, medical wishes, goals for your future or how your money and property will pass on, it will impede the attorney’s ability to create a proper estate plan.

Next, you should look for someone who is a good listener. The attorney must understand what you are saying (or not saying) to make sure that the right solution is provided to meet your needs. A skilled attorney can match your desired outcome with the right planning techniques to carry it out.

Lastly, you should look for a problem solver and not a document producer. With the increasing number of do-it-yourself estate planning options, it is becoming easier to just fill out a form. However, an experienced estate planning attorney is not selling you a set of documents. The attorney is there to provide you with counsel and a comprehensive solution to the worries that keep you up at night and motivate you to begin the planning process. Estate planning is not a one-size-fits-all solution.

You are unique and deserve a plan that captures your needs and wants.