Many of us associate estate planning with complex legal jargon and large financial portfolios, but a complete estate plan is simply a thoughtful strategy for the future. It’s about protecting yourself and your loved ones, regardless of your current assets or stage of life. Read on for a clear summary of the documents included in a basic estate plan, and an understanding of how these essential documents work together to provide peace of mind for you and your family.
A Toolbox For Organizing Assets and Decisions
What exactly is an estate plan? Simply put, as Patricia Amend and Daniel Bortz explain at AARP: “In an estate plan you determine how your money and property will be handled, who will raise any minor children you have, and who will make health care and financial decisions for you in the event of your incapacity or demise.” An estate plan contains several different documents that work together, like tools in a toolbox, to put your affairs in order. Patrick Simasko, a Michigan elder law attorney, points out that it is important to develop a complete estate plan, noting: “Leaving one tool out may seriously impact you and/or your family in the future.” According to Simasko, a complete estate plan should include each of these documents:
- Last will and testament. You specify what happens to your property and who raises your children.
- Living will. With this document, also known as a health care directive, you designate someone to make your health care wishes known if you can’t communicate them.
- Health care power of attorney. You appoint someone to make health care decisions for you if you’re incapacitated.
- Financial power of attorney. You designate someone to make financial decisions if you can’t do so.
- Living trust. You reserve your assets for your loved ones to avoid delays and expenses with the court, in probate.
Key to estate planning is the designation of individuals you trust to carry out your decisions. For example, when a will is written, you will name the executor who will ultimately administer it. In some states an executor is alternatively referred to as the personal representative. When choosing your representative, it’s important to be thoughtful and make sure the individual understands the responsibilities and has the time and ability to carry them out. Though it is typical to name a close relation or friend, a professional can also be chosen. Regardless of who you select, it’s best to arm the executor with as much detail as possible while time is on your side:
To avoid any unnecessary complications in the settling of your affairs, take care to avoid ambiguous or unclear language in your will…..The executor named in a will is responsible for carrying out the testator’s final wishes. The executor is a liaison between the probate estate and the probate court, as well as between the probate estate and the beneficiaries. Their duties include locating and valuing assets of the estate, paying debts, and distributing assets to beneficiaries in accordance with instructions in the will.
It is common for executors to also be beneficiaries of the estate, so it’s helpful to understand: “Executors owe a fiduciary duty to the estate and its beneficiaries that compels them to act in the best interests of both.” It’s often a good idea for executors to obtain expert assistance from lawyers, financial advisors and public accountants. These expenses can be charged to the estate—and professional assistance can make all the difference in efficiently closing out the affairs of the estate. Given the significant obligations. of executors, most states require executors to “have bonds to ensure their trustworthy behavior in their roles. These bonds guarantee that all the estate debts will be satisfied and that the remaining assets will be properly distributed to the appropriate heirs.” More Information about executor bonds, as well as a user friendly online service to obtain them quickly is available at Colonial Surety Company:
Estate Law?
With a few clicks on The Partnership Account® for Attorneys, lawyers everywhere around the country can efficiently help clients secure court and fiduciary bonds, on specific obligee required forms.
Just select the bond needed, send it to your client for payment, and then download, e-file or print the bond. Our fiduciary bonds include: administrator, estate, executor, guardian, personal representative, probate, surrogate, trustee, conservator and the list goes on. Court bonds include: appeal, supersedeas, injunction, replevin, receiver and more.
Easy, speedy court and fiduciary bonds here:
The Partnership Account® for Attorneys
Colonial Surety is rated “A Excellent” by A.M. Best Company, U.S. Treasury listed, and licensed for business everywhere in the USA. Our customers have awarded us a 4.8 Trustpilot score.