27 Aug Basic Estate Planning 101
Estate planning is often misunderstood. People tend to think only of inheritance of property after death by way of a last will and testament. In reality, however, estate planning helps families and businesses get organized and put all the right pieces in place and the right players in the right positions to avoid many of the problems they encounter during life and after death. It typically includes:
- addressing inheritance, guardianship of minor children and burial (last will and testament)
- appointing an agent to act on your behalf with respect to financial, legal and administrative actions if you are unable to do so (power of attorney)
- appointing a surrogate to make medical decisions on your behalf if you are unable to do so (health care surrogate)
- memorializing your wishes with respect to being kept alive artificially on life support by way of a living will (think Terri Schiavo)
- utilizing trusts to manage assets during life (incapacity planning) and avoiding probate and guardianship (probate and guardianship avoidance)
- ensuring your intimate and personal wishes are carried out after death (estate administration and transition)
- securing income replacement with disability and life insurance (risk management)
If done properly your personal board of directors, consisting of your estate attorney, financial advisor and CPA, will collaborate on your behalf to ensure all your affairs are in order. The next step is to ensure that your estate is operating most tax effectively and your assets are adequately protected.
Barry E. Haimo, Esq.