The Necessity of Having a Detailed Estate Plan
Show Your Loved Ones That You Care by Developing an Estate Plan
The holiday season and New Year are a great time to reflect on the past and plan for the future. After celebrating the winter holidays with our loved ones, we begin to solidify our plans and resolutions for the New Year. Developing or updating your estate plan is one of the best New Year’s resolutions you can have, as it will help your family in the wake of your incapacitation or passing.
Types of Estate Planning Documents
There are three types of estate planning documents: wills, living wills and trusts. A will is a legal document that provides specific instructions on the transfer and management of assets after death, and a living will details medical and end-of-life preferences. A trust is a legal or fiduciary arrangement in which one party holds the legal title to someone else’s property. Trusts are similar to wills, but they specify how assets should be used, managed and transferred before death.
Who Has Control of Your Assets if You Don’t Have an Estate Plan?
If you become incapacitated or pass away without a will, your assets will be controlled by the court. This is likely to be an expensive, time-consuming and emotional experience for your loved ones, and your wishes regarding your estate will not be honored since they have not been legally documented. Your estate will be distributed according to Texas probate laws without regard for your intentions. Ultimately, having an estate plan ensures your assets are distributed according to your wishes.
Be as Thorough as Possible
Paying attention to the fine details is absolutely vital in estate planning, because the items included or not included in your will or trust will have an impact on your loved ones. Make sure to include provisions regarding:
- The transfer of your business assets is retirement, incapacitation or death
- Insurance, especially life insurance
- Financial wellbeing of children or other family members under your care
- The appointment of a guardian for minor children or family members with special needs
- The actions to be taken should you become disabled or incapacitated prior to passing away
Regularly Review and Amend Your Estate Plan
You should review and amend your estate plan every two to three years and when you experience significant life events, such as the birth of a child, marriage, divorce, a death in the family or an out-of-state move. Additionally, your estate plan will need to be reviewed and amended whenever there is a change in state tax law in order to keep your will or trust current.
Because probate litigation is emotionally and financially taxing for the bereaved, drawing up a detailed estate plan will make sure your loved ones will have fewer worries in the wake of your passing. As we near the end of this year and the beginning of a new one, seriously consider creating or reviewing your