While many people think of senior citizens when they consider who should make an estate plan, older people are not the only ones who benefit from planning ahead. In fact, for young couples and young families, the estate planning process can be especially important. If the couple has a young child, instructions must be provided for who should become that child’s guardian if something should happen to the parents. There must also be provisions made for the child’s financial support if the parents pass away. If a young couple is not yet married but they wish for their assets to be left to each other or their partner to act as their agent in case of incapacity, estate planning is also necessary to make that happen. Learn more here about why young couples need an estate plan.
If you are making an estate plan, you need to think about how your plan will help ensure family members are cared for. This includes pets, as pets are family too. You should think carefully about who you want to serve as guardian for your pets if something happens to you so you can provide instructions in your estate plan for who should take over their care. You may also wish to provide financially for your pet’s needs when you make your plans. Find out more here about why you shouldn’t abandon your pets when you make your estate plan and what you can include in your plans to ensure that your pets are going to be cared for.
When you are making an estate plan, you will likely hear lots of terms like simple wills, living wills, and living trusts. It is easy to become confused about the terminology, but it is important to understand the key differences between these estate planning tools. Simple wills are a common tool that allow you to provide some basic instructions to your executor, who is the person chosen by you in your will to wind up the affairs of your estate. Simple wills also make it possible to provide instructions on who your property will transfer to, although the assets transferred will usually have to go through probate and you will have little or no control over what happens to them after death.
Living trusts also allow for assets to transfer, but only the assets held in the trust. Living trusts also provide help with incapacity planning, as trust assets can be controlled by a backup trustee if something happens to you. Assets held in living trusts transfer through trust administration, not probate, which means that they can go to new owners more quickly. However, they still count for estate tax purposes.
Finally, living wills are used to provide instructions on medical care you want in an emergency. They do not facilitate the transfer of assets at all. Learn more here about the differences between simple wills, living trusts, and living wills.
Small business succession planning involves the process of making plans in order to ensure the small business can easily be transferred to new owners, without operations being interrupted. An ownership interest in partnerships, sole proprietorships, LLCs, and even closely held corporations cannot transfer to new owners as easily as a publicly traded corporation can transfer to new owners. If the owner is involved in day-to-day operations, the transfer becomes even more complicated because new owners must take over immediately. Plans must be made to ensure that this can happen, whether death, disability or simply retirement occurs. Find out more about small business succession planning here.
Pay on death accounts are sometimes used as part of an estate plan so the assets held within the accounts are able to transfer outside of probate. A pay on death account means that it is clear who the money in the account will go to: the person who is designated as the payee after a death. Because the process of transferring account assets happens upon death, there is no delay like occurs when assets must transfer via probate. Find out more her about whether pay on death accounts are a simple solution.
These questions are just the tip of the iceberg when it comes to understanding estate planning. You should strongly consider working with an estate planning lawyer to get help in making plans for your future. Zimmer Law Firm can help. Give us a call at 513.721.1513 or download our estate planning checklist to learn more about the ways in which we can assist you with estate planning.