What is Estate Planning?
More Than Just a Will
Estate planning is a process that empowers individuals to prepare for their death or incapacity through a deliberate conversation about the transfer of assets after death and issues surrounding the end-of-life.
The outcome of a comprehensive estate plan should be a clear and unambiguous process for the transfer of assets upon a person’s death, and protection during life for unforeseen disabling medical events. Some of the documents that are often used to accomplish a comprehensive estate plan include:
- A written will
- A Financial Power of Attorney
- A Medical Power of Attorney
- A Directive to Physicians or Surrogates (also known as a Living Will) for end-of-life medical treatment
- A Declaration of Guardian in the Event of Later Incapacity
- A Declaration of Guardianship for Children
- Burial Agent and Funeral Instructions
Estate planning can also impact the amount of federal estate taxes paid so more assets may go to loved ones (and less to the government). When a business is involved, estate planning may also include business succession documents to ensure a non-disruptive transition of ownership.
A declaration of appointment for a guardian is essential if there are minor children and a useful tool for you as part of end-of-life planning. Such appointment may be included in a will or set out in a separate document.
Trust documents are often prepared either in place of a will or in addition to a will depending on the circumstance.
Other Asset Transfers – Non-Probate Assets
Estate planning also addresses that fact that many assets are not distributed by the terms of a will, but by beneficiary designations made in connection with bank and brokerage accounts, life insurance policies, titled property such as automobiles and boats, and retirement accounts. A review and possible modification of these accounts are a necessarily part of the estate planning process.