A lot of people think that the term “estate planning” describes the act of creating a simple will to state your final wishes. In fact, there are other tools to use to carry out your final wishes, and a will is not always the best choice.
Even if you use a will, there are other issues you should address to be comprehensively prepared.
Letter of Last Instructions
Through a will, you name an executor to act as the estate administrator. The executor admits the will to probate after your passing, and the court supervises the administration phase.
During this process, the executor notifies creditors about your passing, and are given time to come forward. Meanwhile, the executor identifies and inventories the estate assets, and prepares them for distribution.
A letter of last instructions can help prepare the executor for her role. Through such a letter, you can pass along the location of keys, access codes, important papers, and login information.
Contact information for people that should be notified about your passing should be included. Final arrangements preferences may also be shared.
There are no particular rules to follow when composing a letter of last instructions. Simply use use common sense and ask yourself what the executor needs to know to complete their tasks.
Incapacity Planning
According to the Alzheimer’s Association, Alzheimer’s strikes about 32 percent of individuals that are 85 years of age and older. Other diseases cause cognitive impairment, and physical conditions can have a debilitating impact.
Failure to prepare for this possibility can result in appointment of a guardian to act on your behalf. This can be an expensive and embarrassing process, and cause disagreements within the family.
You can take control of the situation before it happens if you execute the appropriate incapacity planning documents.
If you have a living trust, you act as the trustee while you are alive and well. You can name a disability trustee to administer the trust in the event of your incapacity. To account for property not held by a trust, you can name a representative in a durable power of attorney.
Advance health care directives provide direction related to medical decisions. A living will expresses your life support preferences, and can also include organ and tissue donation choices.
You may also name an agent to make medical decisions on your behalf through a durable power of attorney for health care.
In addition, doctors cannot share medical information with anyone other than the patient in general. However, you may sign a Health Insurance Portability and Accountability Act (HIPAA) release to provide your agent with access to information.
These documents all work together to help avoid appointment of a guardian.
Successor Beneficiary Designations
When you name beneficiaries in your will or trust, IRAs, or life insurance policies, you should make sure to add successors. This is often overlooked, and administrators sometimes fail to explain the need when you are filling out forms.
If you do not take this step and the sole beneficiary is no longer around to collect the benefits, a complicated and potentially contentious situation can arise.
Schedule a Consultation Today!
As you can see, there are a number of details that should be discussed when you are planning your estate. We can help you develop a comprehensive plan that covers all of your concerns, and it will be custom crafted to ideally suit your needs.
You can schedule a consultation at our Oklahoma City estate planning office if you call us at 405-843-6100. You may also use our contact form if you would rather send us a message.
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