Unfortunately life can be unpredictable. No doubt, discussing your own death is an uncomfortable subject for you and your family. However, you need to ensure that if anything was to happen to you and/or your spouse, your family and children are protected. You can accomplish this by having a Will, Trust, and/or a Medical Power of Attorney.
Benefits of having a will, trust and/or a medical power of attorneys
· Allowing your estate (i.e. all of your assets such as properties, cash, life insurance policy, etc.) to pass to others without a Will or a Trust can often be more expensive and time consuming. Although, all estates, with or without a Will, must go through the probate process (a legal process by which estate is passed from the deceased to his/her heirs), having a Will would speed up the process.
· Helps ensure that your estate passes to the intended beneficiaries.
· Ensures that you choose the individual(s) who will care for your minor children in case of your premature death.
· Dictates how your minor children and other beneficiaries receive and use the money.
· Careful estate planning can minimize inheritance taxes that your beneficiaries would otherwise incur.
· Preserves your wishes as to certain end-of life situations (i.e. life support, artificial nourishment).
· Executing a durable power of attorney designates someone to act on your behalf to make medical decisions if you are mentally incapable of making those decisions yourself, without the need of having the court appoint a guardian.
· A carefully drafted Will can help prevent disputes among family members regarding your assets.
· A Will gives you the peace of mind that you have prepared for the unpredictable and that you have a plan in place to care for your loved ones.
5 Key Questions to Consider
1. Who will be named as your beneficiaries? This can be one or multiple individuals, and/or nonprofit organizations.
2. Who will be named as an executor (someone who manages the assets and distributes them to the intended beneficiaries) of your estate? You can name an individual or an institution. Keep in mind that being an executor of an estate is a time consuming process. Elect someone who has the time and the required skills to perform this function. You may want to consider having a family member or a friend as a co-executor along with an institution.
3. How will your assets be distributed among your beneficiaries? Although, this may seem straight forward, there could be intricacies when it comes to assets that are being financed (mortgaged). You may also need to take into consideration costs associated with the sale of those assets prior to distribution of the money to your beneficiaries.
4. If you have minor children, who will be named as a guardian? You may also need to consider creating a trust and naming a trustee to protect their inheritance.
5. If you have divorced and remarried, you may need to consider spouses children from a previous marriage. Ask your attorney how to ensure that your assets are divided according to your wishes.
Most importantly, remember to keep your Will, Trust, and/or Medical Power of Attorney up to date. If you have changes to beneficiaries, executors, trustees, guardians, financial circumstances, or any other changes, please make sure to reflect those changes on the respective documents.
Article written by Tatyana Agarunov of Agarunov Law Firm, an attorney licensed in the States of New York and New Jersey.
This article does not constitute legal advice. This article is not intended to create, and does not create, an attorney-client relationship, and you should not act or rely on any information in this article.