What an Estate Plan Includes:
Every estate plan that we create includes a will, a power of attorney, and a health care directive.
In most cases an estate plan will also include a trust. These are explained below.
What is a Will?
A Will is a formal legal document that names an executor or an administrator to manage your estate; it describes who is to receive your assets and belongings, and in some cases who should be the guardian of your minor children or other dependent family members. A Will must be probated by the court. Probate is a court supervised process whereby it is established that the Will is the final expression of your wishes. Your executor is charged with locating and establishing a value for all of your assets, paying your creditors and taxes (if applicable), and distributing your assets to your beneficiaries. Probate is commonly viewed as an expensive and time consuming process. However, with proper planning the costs and burdens on your family and beneficiaries can be minimized.
What is a Trust?
A Trust is a legal arrangement whereby one party (the Trustee) manages property for another party (The Beneficiary). There are many kinds of Trusts. A living Trust is established during your lifetime and is a tool to avoid probate, maintain privacy, and in some cases reduce taxes. The Trust document is a legal document that names a Trustee and any successor Trustees to manage the property held in the Trust. The Trust document is a written expression of your wishes for your assets during your lifetime, should you become incapacitated, and after your death. Because the Property held in the Trust is titled in the name of the Trust it does not pass through your estate and does not need to be probated. A living Trust is an excellent estate planning tool. At Susan Floyd Law, we will explain all of your choices and help you decide the best option for your needs.
What is an Advanced Health Care Directive?
An Advanced Health Care Directive names an agent to act on your behalf to make medical decisions for you if you are unable to express your wishes, it describes your medical treatment preferences, it names a guardian for you should a guardian be necessary, and it plans for other important issues related to your health. At Susan Floyd Law, we will provide everything you need for a valid and enforceable health care directive.
What is a Power of Attorney?
A power of attorney is a legal document that authorizes another person to act on your behalf concerning your financial affairs. The attorney-in-fact acts as your agent and has a fiduciary duty to act honestly and with loyalty to your interests. Choosing an agent is an important consideration because that person will have broad authority over your assets. It is important to have an attorney draft a power of attorney rather than “do it yourself” from a form document purchased online, because if the document has errors, a court may need to intervene. A power of attorney is only effective while you are alive. Once a person has passed away, the attorney-in-fact or agent, no longer has authority to act on your behalf. For this reason, it is important to have both a will and/or trust in addition to a power of attorney.