There is no one-size-fits-all estate plan that is right for everyone, but the differences are related to the asset transfer methods that can be used. Aside from that, there is a basic framework that is universal, and it boils down to the execution of five core documents.
Asset Transfers
The flexible portion is the asset transfer component. Obviously, you can state your final wishes in a simple will, but there are drawbacks and limitations. One of them is the fact that a will is admitted to probate, which is a costly and time-consuming legal process.
Unless you include a testamentary trust, the assets will be distributed all at once in lump sums, and there would be no safety rails going forward. This can be a source of concern if you are going to be leaving money to someone that is not ready to responsibly handle a windfall.
An alternative would be a living trust with a spendthrift clause. The trustee would manage the assets, and the beneficiary would have no direct access to the principal.
Their creditors would “step into their shoes,” so they would be in the same position. Assets could be distributed to the beneficiary incrementally over time to prevent reckless spending.
The living trust is the ideal estate planning centerpiece for many people, but there are other types of trusts that satisfy different specific objectives. When you work with an attorney from our firm, we can gain an understanding of your situation and make the appropriate recommendations.
Living Will
A living will is a document that is used to state your life support preferences. You can also add your organ and tissue donation designations and your comfort care medication choices.
Life support preferences are personal, and no one should be forced to make a life-and-death decision for someone else. In addition to the difficult position that the decision-maker would occupy, there could be disagreements among family members at the worst possible time.
Durable Powers of Attorney
Health care matters can arise that are not related to the use of life-support measures. To account for this possibility, your incapacity plan should include a durable power of attorney for health care.
You utilize this document to empower an agent to make medical decisions on your behalf if it becomes necessary.
Another durable power of attorney should be added to account for financial decision-making. It should be noted that you can designate a disability trustee if you have a living trust.
HIPAA Release
The Health Insurance Portability and Accountability Act was enacted in August of 1996. It was put in place to protect the privacy of patients, and a provision in it prevents doctors from sharing medical information with anyone other than the patient.
This includes family members, so you should include a HIPAA release in your incapacity plan to give the health care representative the ability to access your records. It should be noted that you can give others the same access if you choose to do so.
Access Our Free Estate Planning Worksheet!
We’re glad you found our site, and you should bookmark this blog and come back to visit us to stay up-to-date. There are other written resources that you can tap into as well, and one of them is our estate planning worksheet.
This resource has been carefully prepared, and you will come away with a better understanding of this important process if you take the time to go through it. There is no charge, and you can visit our worksheet access page to get your copy.
Need Help Now?
If you are here because you have been thinking about working with an estate planning attorney to put a plan in place, there is no time like the present. We can gain an understanding of your financial position and your legacy goals and help you devise a plan that ideally suits your needs.
You can set the wheels in motion right now if you give us a call at 802-879-7133, and you can fill out our contact form if you would rather send us a message.
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