In fact, it’s more important than ever to have a plan in place, especially if you have people relying on you. Working with estate planning professionals in order to have all of your estate taxes and estate distribution covered during the probate process is a great way to ensure that your affairs are in order, your loved ones are taken care of, and your financial obligations are met, in the event that something happens to you.
What is an estate plan?
An estate plan is a series of legal documents that ensures your assets and liabilities will be distributed as you wish after your death.
Why do I need an estate plan?
If you die without an estate plan, the courts will appoint someone to handle your affairs for you. Depending on where you live, this person may not know your wishes and you may not want this persons wrapping up your final affairs. Because the government (not you) decides how your assets are divided, this person could distribute your assets to family members that you do not have a good relationship with or that you have no contact with. The government is distributing your assets based on its idea of fairness. Worse still, if you have young children and no estate plan the government will decide who will be raising your children.
How do I make an estate plan?
Good estate planning will start with a well-written Will. A Will spells out exactly who gets what when you pass away. It is a must-have if you have children because you can name a guardian to care for young children. If you have children from a previous marriage or a blended family an estate plan will ensure their rights are protected. Even if your assets are small, you should be sure to work with an attorney – Wills need to follow specific state laws, and poorly written ones run the risk of being declared invalid by a court.
Your Will does not take effect until you die, which means that someone needs to manage your assets until then or in the event of incapacity. You can name that person in separate legal documents and sometime a trust agreement may be necessary to accomplish your estate plan goals. It may be prudent to name the same person to handle your affairs, unless you have a compelling reason not to. An experienced attorney can help you navigate these difficult decisions.
Your beneficiary designations—those found on retirement plans, IRAs, annuities, and life insurance policies—may also need to be updated to be consistent with your wishes, so check with an attorney if you want to ensure they’re consistent. For example, unless there’s good reason to do otherwise, your retirement account should go directly to your spouse, if she is your sole beneficiary. If other beneficiaries are named as secondary beneficiaries, they would not receive a share unless your spouse was not alive.
Do I need to hire an estate planning attorney?
It is wise, and recommended, to hire an estate planning attorney. As we previously noted, hiring an attorney during the process of creating your Will and estate plan is important to ensure that the document is legally sound and complies with the requirements for your particular state. You should look for an attorney who drafts estate planning and is familiar with the ins and outs of each of the laws surrounding estate distribution and the estate planning process.
How much should I pay for an estate plan?
As with other legal matters (and nearly everything else), there are quality variations between lawyers. Most estate planning attorneys will provides their services for a flat rate fee, however, some may provide service at an hourly rate. It’s difficult to give hard numbers for how much you should expect to pay because the cost of the estate plan is based upon the time and effort required, the novelty and complexity of the estate plan, and the experience, reputation, and expertise of the lawyers performing the services. In order to further assess how much you should be paying for your estate plan, refer to breakdowns of the cost of estate planning, such as this one by SmartAsset! (https://smartasset.com/estate-planning/estate-planning-costs)
Tina James, Estate Planning Attorney
Protecting your family starts with planning. We take the time to ask lots of questions and review your entire estate to help prepare a plan that reflects your goals and wishes. Most estate plans include a Will, a Durable Power of Attorney, an Advanced Directive for Health Care/Living Will. In some estate plans, a Trust may be needed.
We are committed to helping our clients develop a comprehensive estate plan to meet their needs and the needs of their families.