Carefully planning your estate offers many benefits, including making sure your property goes where you want, saving money for your heirs, letting your estate be transferred faster, and helping you plan in the event you become disabled.

Certain documents are part of most people s estate plan, including wills, living trusts, powers of attorney and living wills. Here is an explanation of these documents and the role each plays in your estate plan.

Will

A Will is the most basic estate-planning tool. With a Will you can do many things, including:

• Determine how your property will be distributed when you die. A Will lets you name your beneficiaries. These are the people whom you want to receive your property when you die. If you have no Will, your property will be distributed according to state law. The property may not be distributed the way you want, since it is distributed without the needs or circumstances of the recipients.

• Name an executor. A Will can also name an executor. The executor will oversee your estate s financial affairs during the probate process, including making sure your debts are paid and that your property is distributed in accordance with the instructions stated in your Will. Without a Will, the law designates someone to do that job. The person chosen may not be the person you would want to serve in this capacity.

• Set up a trust. A Will can also set up a trust, which can help protect assets and save taxes. Thus, for people with substantial assets (like a home), a Will can be a cost-saving tool.

• Name a guardian. For married couples who have minor children, Wills are essential. Each spouse should have a Will in order to select a guardian for the children in case both parents die while the children are still minors. Although the guardian is approved by the court, the court normally picks the person recommended unless there is a compelling reason to choose someone else.

Wills are required by law to be in writing. A formal will must be signed by you and witnesses according to special procedures.

Living Trust

Living trusts are very popular because they can help avoid the delays and expenses of probate, the court supervised procedure of administering your Will.

A trust is a legal device that lets you stop being the legal "owner" of property but still receive the benefit from it. Trusts help avoid probate because they allow property in the trust to be transferred without going through this process. Trusts can also help lower estate taxes.
Another use of living trusts is to help avoid conservatorship proceedings (called "guardian ship" proceedings in some states) if you become incapacitated. Since you have already given someone the power to manage the assets in your trust, there is no need for a court to appoint someone.

A living trust is created by a written trust document. The document will name a person or entity to serve as trustee (normally you), a successor trustee to take over when the first trustee dies, or becomes incapacitated, and it will also name the beneficiaries. In addition, the trust document will give instructions on how to manage and distribute the property in the trust.

Along with creating a trust document, property that will be put in the trust must be transferred to it. You can place almost any type of property in it, including money, real estate, stocks, bonds and automobiles.

Power Of Attorney

Powers of attorney are used to address the vital question of who will make and handle your personal and financial affairs if you are incapacitated and cannot do so yourself. The most commonly prepared document is a durable power of attorney.

• Durable Power of Attorney. This is a document in which you name someone to handle your personal and business matters if you can t do so yourself.
  With a durable power of attorney, you can name someone to handle your personal and business affairs immediately, or when a specific event occurs, such as your incapacity (this is sometimes called a "springing power of attorney").

Health Care Proxy

A Health Care Proxy is used to address the vital question of who will make your health care decisions if you are unable or otherwise incapacitated and cannot do so yourself.

• Health Care Proxy - This document lets you appoint someone, such as your spouse or child, to make your medical decisions if you are unable or otherwise incapacitated and cannot do yourself.  This power can cover a variety of medical decisions.

Living Will

A Living Will states your desires about using life support equipment if you are terminally ill and cannot communicate your wishes. With a Living Will, you can authorize the withholding of life- support equipment so you can have a "natural" death. You can also use a Living Will to specify that you want all types of treatment used to keep you alive.

Living Wills are extremely useful because they can help prevent agonizing disputes between family members over what you would want to happen in the event life support equipment was needed to keep you alive.

When To Make Documents

Anyone with a family, some savings or other property should prepare estate planning documents. This is especially important for seniors and anyone in less than perfect health. But even people in good health can be victims of accidents, and hard as it is to accept, eventually everyone dies. So after reaching adulthood, no one is too young or healthy to prepare estate planning documents.

Conclusion

Estate planning involves arranging your affairs to be handled by the people you want when you become unable to handle them yourself due to illness, incapacity or death. It involves thinking about the future and having the right documents to help make sure your wishes are carried out. Our firm can help you prepare a plan for managing your property while you are alive, and make sure you have all the proper documents to manage your estate when the time comes.

This article is published for the clients and friends of this firm. It provides general information. Due to complexities and constant changes in the law, exceptions to general principles of law, and variations of state laws, one should seek professional legal advice before acting on any matter.