Introduction to Wills and Estate Planning
Estate planning in Texas is little different than other states but there are specific requirements for each aspect of your estate plan. The overall objective of your estate plan is to have your property distributed according to your wishes. The estate planning process starts with a will and can include many other elements like trusts, living wills and powers of attorney. Your will is the cornerstone of your estate plan so we will start there.
The first and often the most important instrument to put in place is your last will and testament. A will is a legal document that outlines your wishes regarding your assets after you die. Many people make their own wills through software or forms they download off of the internet but this isn't always a wise choice. Requirements for wills are different from state to state and are not always easy to interpret. If you don't create a will that can be validated in probate court then your estate may be disposed of as if you never even wrote a will. The bottom line is that hiring a professional to help craft your last will and testament is a smart choice and it can be done for a reasonable fee.
Your will establishes your wishes with respect to your property, but what if you become incapacitated and can't direct others as to your wishes? This is where powers of attorney come in to play. A power of attorney authorizes someone else to act on your behalf in business and legal affairs. A durable power of attorney allows another party to act on your behalf if you become incapacitated and are not capable of making decisions on your own. A health care power of attorney is a durable power of attorney that is specific to health care situations.
Living Will - A living will is an advanced directive that spells out your wishes to caregivers if you become unable to communicate them due to incapacity. It can be very specific to certain situations such as not wanting to maintain life support if a physician determines that your situation is terminal. A living will is usually created in conjunction with a Health Care Power of Attorney.
Next we are going to cover Trusts. Trusts are another vehicle that allows you to direct certain types of property with the added benefit that you can place restrictions and requirements on the assets. One of the most significant advantages of trusts is that there is no court involved. This allows for immediate dispersal of assets by the trustee (the person administering the trust). Because there is no probate court involvement trusts can also bypass public record of the transactions.
Lastly we are going to cover some of the tools that are available to help manage your tax burden upon your death. Life insurance is one of the primary methods to manage taxes at time of death. There are also a large variety of trusts that are effective as well. Estate planning for tax consequences is one of the more complicated aspects of estate planning and a professional can help you craft an appropriate plan.
Now that you are familiar with some of the estate planning tools it is time to start the process. Whether you go it alone or enlist the help of a professional the first step is to create a list of all of your assets. Once you have your list of assets you will need to make a decision about what you'd like to happen to each asset upon your death. Should it go to family, your alma matter, your favorite charity or someplace else that is near and dear to you?
Estate planning can seem like a daunting undertaking, but knowing that it is very important and taking it one step at a time will help you complete the process. Hiring professionals to help you in the process is also extremely helpful and highly encouraged. - 23210
The first and often the most important instrument to put in place is your last will and testament. A will is a legal document that outlines your wishes regarding your assets after you die. Many people make their own wills through software or forms they download off of the internet but this isn't always a wise choice. Requirements for wills are different from state to state and are not always easy to interpret. If you don't create a will that can be validated in probate court then your estate may be disposed of as if you never even wrote a will. The bottom line is that hiring a professional to help craft your last will and testament is a smart choice and it can be done for a reasonable fee.
Your will establishes your wishes with respect to your property, but what if you become incapacitated and can't direct others as to your wishes? This is where powers of attorney come in to play. A power of attorney authorizes someone else to act on your behalf in business and legal affairs. A durable power of attorney allows another party to act on your behalf if you become incapacitated and are not capable of making decisions on your own. A health care power of attorney is a durable power of attorney that is specific to health care situations.
Living Will - A living will is an advanced directive that spells out your wishes to caregivers if you become unable to communicate them due to incapacity. It can be very specific to certain situations such as not wanting to maintain life support if a physician determines that your situation is terminal. A living will is usually created in conjunction with a Health Care Power of Attorney.
Next we are going to cover Trusts. Trusts are another vehicle that allows you to direct certain types of property with the added benefit that you can place restrictions and requirements on the assets. One of the most significant advantages of trusts is that there is no court involved. This allows for immediate dispersal of assets by the trustee (the person administering the trust). Because there is no probate court involvement trusts can also bypass public record of the transactions.
Lastly we are going to cover some of the tools that are available to help manage your tax burden upon your death. Life insurance is one of the primary methods to manage taxes at time of death. There are also a large variety of trusts that are effective as well. Estate planning for tax consequences is one of the more complicated aspects of estate planning and a professional can help you craft an appropriate plan.
Now that you are familiar with some of the estate planning tools it is time to start the process. Whether you go it alone or enlist the help of a professional the first step is to create a list of all of your assets. Once you have your list of assets you will need to make a decision about what you'd like to happen to each asset upon your death. Should it go to family, your alma matter, your favorite charity or someplace else that is near and dear to you?
Estate planning can seem like a daunting undertaking, but knowing that it is very important and taking it one step at a time will help you complete the process. Hiring professionals to help you in the process is also extremely helpful and highly encouraged. - 23210
About the Author:
Cindy writes articles about estate planning topics like Texas Living Wills and how to Write A Will at TexasWills.com.
posted by X - Men @ 4:15 AM
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