Creating an estate plan is vital to protect yourself and toprotect your assets. There are many different techniques that can be utilizedto create a comprehensive estate plan. You will need to make certain thatyou select the right approach to making plans for the end of your life and toensure your desired legacy. The right approach is based on the specifics ofyour personal situation, including the amount of wealth that you own, who youwish to provide for after you pass away, and the types of assets that you ownand that you plan to pass on.
Parman & Easterday provides personalized one-on-oneassistance with the estate planning process. This allows our experiencedlegal team help you utilize the tools that work best for you. There are a widevariety of different estate planning techniques that our firm can help youexplore, including some of these top estate planning techniques that aredescribed below.
Creation of a LastWill and Testament
For some people, a last will and testament is often thestarting point when creating an estate plan. Your last will and testament canspecify who you want to inherit the assets that you haven’t made plans totransfer through other means. You can include instructions in a will forguardianship of children or for the care of your pets. You can also provideinstructions for how you want to be buried and memorialized after your death.Wills are relatively simple to create, especially with the right legal help, andthey can be updated as your life circumstances change. It is, however,important to follow legal formalities so your will is enforceable and so youcan reduce the chances that your will is successfully contested.
Trusts provide you with much more flexibility and controlthan wills, and can do important things that wills cannot- including helpingyou to protect your assets from many different potential sources of loss. For agrowing number of people, a trust is the foundation of their estate plan.
There are different kinds of trusts, including revocableand irrevocable trusts, and each provides different benefits in the estateplanning process. A revocable living trust offers flexibility, protection ofassets in case of incapacity, and the ability to transfer assets through trustadministration instead of through the probate process. On the other hand,an irrevocable trust can provide much more protection for assets, includingprotection from creditors.
There are specialized trusts that you can create to addressspecial situations. For example, if you have a disabled loved one, a childunder 18 who you’re going to provide an inheritance to, or a spendthrift heirwho 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, includingincome tax benefits, lifetime income, a tax-free sale of assets and a reductionin your estate tax liability. A charitable remainder trust is an exampleof a charitable trust that provides for payment of income during the lifetimeof a designated person, and allows the creator of the trust to take a generoustax deduction when assets are transferred into the trust. Upon the death of thelifetime income beneficiary, assets are then transferred to the charitableorganization that you intended to support through the creation of thetrust.
When you have financial accounts or you own real property,you can choose to own that property with another person. Joint ownership canmake the estate planning process easier if you structure your ownership in aspecific 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. Anyproperty that is owned with rights of survivorship will not have to be disposedof in a will. When a co-owner dies, the surviving co-owner(s) willautomatically inherit the deceased person’s ownership interest by operation oflaw. However, be careful. The minute the first joint tenant dies,the property is now titled in one person’s name. Since all assets titledin one person’s name goes through probate, that means the asset will have to beprobated upon the death of the surviving joint tenant.
Pay on DeathAccounts
You can designate many types of accounts to be pay-on-deathaccounts. When an account is a pay-on-death account, the death of the accountowner will automatically result in the account balance being paid to adesignated beneficiary. The account will not transfer through the probateprocess. Instead, the instructions on the account to pay it to a designatedbeneficiary upon the death of the account owner will be followed.
It is important to make sure that if you designate anyaccounts as pay-on-death accounts, you keep the account information updatedwith your current choice of beneficiary. If you name a romantic partneras a beneficiary, for example, and you then end your relationship with thatperson, you likely no longer want him or her to inherit the money in theaccount. You will have to change the designated beneficiary. Simplychanging your last will and testament will not impact what happens to theassets that are held within the pay on death account.
Getting Help from anEstate Planning Lawyer
Parman & Easterday can help you to understand whattechniques will work best for your estate plan. Often, when creating a legacyplanning, many people incorporate different techniques so they can provide fordifferent heirs or beneficiaries or so certain assets will be treateddifferently than others. Whatever your goals and whatever your hopes are forthe planning process, we will work hard to make sure you have chosen the rightlegal tools and used them effectively to protect your financial security and toprotect your loved ones.
To find out more about how Parman & Easterday can helpwith the estate planning process, join us for a free seminar. You can also give us a call today at (405) 843-6100 or contact us online to getpersonalized advice with making your plans. Call today to work with our legalteam and get your plans in place now so you’ll have the peace of mind thatcomes with knowing your legacy is secure.