An estate plan ensures that your health and financial wishes are met during your lifetime and after your death. Absent proper planning, your family and heirs may be subject to expensive court proceedings. Better to take matters into your own hands now! Below are the key documents that comprise an estate plan.
Health Care Advance Directives, (aka Health Care Proxy, or Living Will), allow you to authorize others to make health care decisions for you if you cannot, and to express your end-of-life care wishes. Physicians and nurses must treat unless told otherwise, so a Health Care Advance Directive is necessary if there are situations in which you would not want to be kept alive (think Terry Schiavo).
Durable powers of attorney for financial purposes let you authorize an “agent” to handle your financial affairs when you are no longer able. Your agent acts as a “fiduciary,” for your benefit, and must sign a document acknowledging this duty. The word “Durable” means that the “power” is still good after you become incapacitated. New Hampshire laws are very specific, and anyone living in this state should have a Durable Power of Attorney that complies with our laws. Without an up-to-date Power of Attorney, your family may need to go to court to get a guardianship over you to handle your affairs, costing thousands of dollars.
Wills direct where your assets go upon your death and must be approved by a Probate Court that also appoints your Executor. Wills only govern assets solely in the name of the deceased. Assets owned jointly, assets in trust, assets with designated beneficiaries, like IRAs, are not subject to a Will, unless you name no beneficiary. Those assets pass automatically on death to the joint owner or designated beneficiary. Unique only to Wills is the ability to nominate a guardian for minor children. If you die without a Will, a judge appoints a guardian for your minor children, although that person may not be one you wanted, and your assets will be distributed pursuant to statutory rules (called “Intestate Distribution”), which may not track your wishes.
You can avoid the uncertainty of the probate process by utilizing and funding a revocable trust where you appoint a trustee to hold assets according to the terms of the trust agreement. During your lifetime, you can be the trustee and the primary beneficiary without needing to file a separate tax return. On your death, a successor trustee takes over, and distributes the assets or holds them in trust for your beneficiaries, as you specifically direct. Trusts are also useful for high net worth couples, with over $5,430,000, for tax planning.
At DTC Lawyers, we can guide you through estate planning so that upon your death or incapacity, your wishes are respected, your assets go where you want and your goals are accomplished.