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Estate Planning
& Trusts
1. What is an estate plan and do I need one?
An estate plan is a "plan" to handle
your assets if you become incapacitated, and to
distribute your assets at your death. A plan can
be very simple, e.g., a Will, or involve one or
more Trusts and related documents. Most people do
need an estate plan. If you do need one, the type
of estate plan you need depends on your assets and
your ideas about whom should receive your assets
at your death.
2. What is a
will?
A will is the legal statement of a person's last
wishes as to the disposition of his or her
property after death. It instructs the probate
court how to distribute your assets after all
debts, taxes and costs of administration are paid.
3. Do I really
need a will?
A will is a good idea for just about everyone. A
will is a document in which a person declares what
he wants done with his property at the time of his
death. A will has no effect until the person who
wrote it, known as the testator, dies. The
testator can also revoke a will at any time before
his death. If you die without a will, the state
will distribute your property to your heirs
according to the state's intestacy statutes.
4. What estate
planning documents do most people need?
Medical Power of Attorney: This names a person to
make medical decisions on your behalf if you are
unable to do so. You can also authorize this
person to discontinue (or not start) life
support-like procedures, if you are terminally
ill.
Durable Power of
Attorney for Assets: This document enables the
person named to deal with any
if your property, as you would, during your
lifetime.
5. What is the
role of an executor?
The executor has three main jobs:
- Gather
together the assets of the estate;
- Pay all the
valid outstanding debts of the estate; and
- See that the
estate is distributed in accordance with the
terms of the will.
6. How often
should I update my will or estate plan?
It is a good idea to update your will and/or
estate plan every few years or after the
occurrence of significant life events such as
marriage, divorce, the birth of a child, or
adoption. Even if you haven't experienced any of
these events since you last updated, there may
have been changes in tax laws or changes in your
financial situation that necessitate a
reevaluation of your estate plan.
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