FAQs

Estate planning is the process of arranging for the management and disposal of your estate during your life and after your death. It involves a set of legal documents and strategies that help you:

• Name a guardian for your minor children.

• Determine how your assets will be distributed.

• Appoint someone to manage your finances and make healthcare decisions if you become incapacitated.

• Minimize taxes and costs associated with transferring assets.

• Avoid the probate process.

Almost everyone can benefit from some form of estate planning. It's not just for the wealthy or the elderly. You should consider creating an estate plan if you:

• Have minor children.

• Own a home or other significant assets.

• Are married or in a long-term relationship.

• Want to ensure your assets are distributed according to your wishes.

• Want to name a trusted person to make financial and medical decisions for you if you become unable to do so.

Your "estate" includes everything you own at the time of your death. This can include:

• Real estate (your home, rental properties)

• Financial accounts (bank accounts, stocks, bonds, retirement accounts)

• Personal property (cars, jewelry, furniture, art, heirlooms)

• Life insurance policies

• Business interests

• Will: A will is a legal document that specifies how your property will be distributed upon your death. It can also be used to name a guardian for your minor children. A will must go through a court process called probate to be enforced.

• Trust: A trust is a legal entity that holds and manages assets for a designated beneficiary. Unlike a will, a trust owns the assets once they are transferred into it. Because the trust, not the individual, owns the assets, they can be distributed outside of probate, which can save time and money and maintain privacy.

Probate is the court-supervised legal process of validating a will, identifying and gathering a deceased person's assets, paying their debts and taxes, and distributing the remaining assets to the rightful heirs or beneficiaries. This process can be time-consuming, expensive, and public.

If you die without a will (intestate), the laws of your state will determine how your assets are distributed. This is often based on a hierarchy of your closest living relatives. This may not align with your personal wishes and can lead to a long and complicated legal process for your family.

While a will and/or a trust are central, a comprehensive estate plan often includes:

• Power of Attorney: A legal document that gives a designated person the authority to make financial and legal decisions on your behalf if you become incapacitated.

• Health Care Proxy/Durable Power of Attorney for Health Care: Appoints a trusted person to make medical decisions for you if you are unable to do so.

• Living Will/Advance Health Care Directive: A document that expresses your wishes regarding end-of-life medical treatments.

• Beneficiary Designations: It's critical to ensure that beneficiary designations on assets like retirement accounts and life insurance policies are up-to-date. These assets pass directly to the named beneficiaries and are not controlled by a will.

It's a good practice to review your estate plan every few years and after any major life event, such as:

• Getting married or divorced.

• The birth or adoption of a child or grandchild.

• The death of a loved one.

• A significant change in your financial situation.

• The purchase or sale of a home or business.

• Changes in state or federal tax laws.

The cost of estate planning varies widely depending on the complexity of your situation and where you live. While simple wills can be relatively inexpensive, a more comprehensive plan involving trusts and other legal documents will cost more. The cost of not having an estate plan, however, can be much higher in the long run, both financially and emotionally, for your family.