Creating an estate plan is vital to protect yourself and to protect your assets. There are many different techniques that can be utilized to create a comprehensive estate plan. You will need to make certain that you select the right approach to making plans for the end of your life and to ensure your desired legacy. The right approach is based on the specifics of your personal situation, including the amount of wealth that you own, who you wish to provide for after you pass away, and the types of assets that you own and that you plan to pass on.
Parman & Easterday provides personalized one-on-one assistance with the estate planning process. This allows our experienced legal team help you utilize the tools that work best for you. There are a wide variety of different estate planning techniques that our firm can help you explore, including some of these top estate planning techniques that are described below.
Creation of a Last Will and Testament
For some people, a last will and testament is often the starting point when creating an estate plan. Your last will and testament can specify who you want to inherit the assets that you haven’t made plans to transfer through other means. You can include instructions in a will for guardianship of children or for the care of your pets. You can also provide instructions for how you want to be buried and memorialized after your death. Wills are relatively simple to create, especially with the right legal help, and they can be updated as your life circumstances change. It is, however, important to follow legal formalities so your will is enforceable and so you can reduce the chances that your will is successfully contested.
Trusts provide you with much more flexibility and control than wills, and can do important things that wills cannot- including helping you to protect your assets from many different potential sources of loss. For a growing number of people, a trust is the foundation of their estate plan.
There are different kinds of trusts, including revocable and irrevocable trusts, and each provides different benefits in the estate planning process. A revocable living trust offers flexibility, protection of assets in case of incapacity, and the ability to transfer assets through trust administration instead of through the probate process. On the other hand, an irrevocable trust can provide much more protection for assets, including protection from creditors.
There are specialized trusts that you can create to address special situations. For example, if you have a disabled loved one, a child under 18 who you’re going to provide an inheritance to, or a spendthrift heir who you don’t think can be responsible with the inheritance that you provide, then creating a trust could be the best approach for you.
Charitable trusts can offer multiple benefits, including income tax benefits, lifetime income, a tax-free sale of assets and a reduction in your estate tax liability. A charitable remainder trust is an example of a charitable trust that provides for payment of income during the lifetime of a designated person, and allows the creator of the trust to take a generous tax deduction when assets are transferred into the trust. Upon the death of the lifetime income beneficiary, assets are then transferred to the charitable organization that you intended to support through the creation of the trust.
When you have financial accounts or you own real property, you can choose to own that property with another person. Joint ownership can make the estate planning process easier if you structure your ownership in a specific form. For example, if you own a house with someone else as a co-owner, you can choose to own that house with rights of survivorship. Any property that is owned with rights of survivorship will not have to be disposed of in a will. When a co-owner dies, the surviving co-owner(s) will automatically inherit the deceased person’s ownership interest by operation of law. However, be careful. The minute the first joint tenant dies, the property is now titled in one person’s name. Since all assets titled in one person’s name goes through probate, that means the asset will have to be probated upon the death of the surviving joint tenant.
Pay on Death Accounts
You can designate many types of accounts to be pay-on-death accounts. When an account is a pay-on-death account, the death of the account owner will automatically result in the account balance being paid to a designated beneficiary. The account will not transfer through the probate process. Instead, the instructions on the account to pay it to a designated beneficiary upon the death of the account owner will be followed.
It is important to make sure that if you designate any accounts as pay-on-death accounts, you keep the account information updated with your current choice of beneficiary. If you name a romantic partner as a beneficiary, for example, and you then end your relationship with that person, you likely no longer want him or her to inherit the money in the account. You will have to change the designated beneficiary. Simply changing your last will and testament will not impact what happens to the assets that are held within the pay on death account.
Getting Help from an Estate Planning Lawyer
Parman & Easterday can help you to understand what techniques will work best for your estate plan. Often, when creating a legacy planning, many people incorporate different techniques so they can provide for different heirs or beneficiaries or so certain assets will be treated differently than others. Whatever your goals and whatever your hopes are for the planning process, we will work hard to make sure you have chosen the right legal tools and used them effectively to protect your financial security and to protect your loved ones.
To find out more about how Parman & Easterday can help with the estate planning process, join us for a free seminar. You can also give us a call today at (405) 843-6100 or (913) 385-9400 or contact us online to get personalized advice with making your plans. Call today to work with our legal team and get your plans in place now so you’ll have the peace of mind that comes with knowing your legacy is secure.