Over half of all Americans do not have an estate plan in place. That fact is not all that surprising given the fact that the average person is not familiar with most of the concepts and documents used in an estate plan. Although every estate plan is uniquely tailored to the needs and goals of the person creating the plan, there are some documents found in most plans. A Loveland estate planning attorney at Zimmer Law Firm discusses three estate planning documents you should have in your estate plan.
Last Will and Testament
Typically, a Last Will and Testament serves as the foundation of a basic estate plan. One of the most important reasons to create a Will is that executing a Will ensures that you will not leave behind an intestate estate. Dying intestate means the state decides what happens to your estate assets using the state intestate succession laws. This typically means that only very close relatives will inherit from your estate. Instead of allowing that to happen, your Will allows you to make specific and/or general gifts to more distant relatives, unrelated loved ones, and even charities, organizations, and pets. In addition, your Will lets you appoint someone as the Executor of your estate. The Executor is responsible for overseeing the administration of your estate. Finally, your Will offers you the only opportunity you have to officially nominate a Guardian for your minor child should one ever be needed.
Although they were traditionally used only by the wealthy to protect and guard the family fortune, trusts are now commonly found in the estate plan of the average person. A trust is a relationship where property is held by one party for the benefit of another party. A trust is created by the owner, also called a “Settlor”, “Trustor” or “Grantor” who transfers property to a Trustee. The Trustee holds that property for the trust’s beneficiaries. Trusts are broadly divided into two categories, testamentary and living trusts. A testamentary trust does not activate until after the death of the Settlor whereas a living trust takes effect as soon as all the trust agreement is in place and the trust is funded. A living trust can be further divided into revocable and irrevocable living trusts. A trust can help achieve a wide variety of estate planning goals, including:
- Avoiding probate
- Incapacity planning
- Asset protection
- Medicaid planning
- Planning for parents with minor children
- Special needs planning
- Pet planning
Although the primary focus of your estate plan will undoubtedly be to ensure that your assets are distributed according to your wishes after you are gone; you should also ensure that your wishes are honored while you are still here during a period of incapacity. An advance directive helps you plan for that possibility. The State of Ohio recognizes two types of advance directives, including:
- Health Care Power of Attorney. This document allows you to appoint a surrogate to make decisions for you in the event you are unable to make them yourself because of your incapacity at some point in the future. Your surrogate will have the authority to do things such as consent, refuse to consent, or withdraw consent to medical treatment on your behalf.
- Living Will. This lets you state your wishes regarding life-sustaining or life-prolonging procedures in the event you develop a terminal condition and can no longer make your own decisions.
Contact a Loveland Estate Planning Attorney
For more information, please join us for an upcoming FREE webinar. If you have additional questions or concerns about estate planning, contact an experienced Loveland estate planning attorney at Zimmer Law Firm by calling 513-721-1513 to schedule your appointment today.