Protect yourself and your loved ones
Protect yourself and your loved ones
This section of the website is dedicated to your “Personal Plan”. It is a thoughtful and vital step in planning for the future. Your commitment to gathering and organizing this information is a testament to your love and concern for your loved ones.
As someone who spent years as a caregiver, I know the value of a comprehensive list that families should collect and maintain with the utmost care. It’s not just about ensuring that your wishes are honored; it’s also about easing the stress on your family during what can be an emotionally challenging time.
Your meticulous attention to details like executors of wills and trusts, powers of attorney, financial advisors, and spiritual advisors, will provide a clear roadmap for your family. It ensures that your medical, financial and spiritual needs are met according to your preferences. This can certainly be a source of comfort and assurance for your loved ones, knowing that they are fulfilling your wishes.
The section also touches upon personal aspects such as your primary physician and specialists, living will, DNR and HIPAA information, emergency contacts, and medical insurance details which are vital for medical decisions and treatment.
In sum, the “Personal Plan” section is not just a collection of data; it’s a heartfelt gift to your family. By gathering this information your wishes are respected, and your loved ones supported during a challenging time.
Encourage others to follow your example, to gather, and update this critical information, as it’s an act of love and consideration that transcends generations.
For more information download my free ebook
3 must have legal documents
Before you can create a will, first you need to figure out which type of will is right for you. Believe it or not, there are different types of wills for all kinds of situations. Here’s a breakdown:
● Simple wills
● Mirror wills
● Joint wills
● Living wills
● Holographic wills
● Nuncupative wills
● Deathbed wills
● Testamentary trusts
Don’t let all those options overwhelm you. A simple will does the job for almost everyone. And if you’re married, get a mirror will for your spouse. A mirror will is drafted to be almost identical to your will, but it’ll have your spouse’s name as the testator (the person making the will). Not only can mirror wills save your loved ones from some legal headaches down the road, but they also give you and your spouse freedom to give away your personal belongings to whoever you want.
There are several types of trusts, each designed to serve specific purposes in estate planning and wealth management. The type of trust you should use depends on your individual goals, circumstances, and financial situation. Here are some common types of trusts and when they might be appropriate:
1. Revocable Living Trust: This trust allows you to retain control over your assets during your lifetime. You can make changes to the trust’s terms or revoke it altogether. It’s often used to avoid probate and ensure a smoother transfer of assets after your death.
2. Irrevocable Living Trust: With this trust, you relinquish control over the assets placed in the trust. It’s often used for estate tax planning, asset protection, and charitable giving. Once the trust is established, you generally cannot make changes to it without the beneficiaries’ consent.
3. Testamentary Trust: Created within a will, this trust only becomes effective after your death. It’s often used to provide for the needs of minor children, disabled beneficiaries, or individuals who may not be able to manage their finances.
4. Special Needs Trust (Supplemental Needs Trust): This trust is designed to provide for the needs of a disabled beneficiary without disqualifying them from government benefits like Medicaid and Supplemental Security Income (SSI).
5. Charitable Remainder Trust (CRT): This trust allows you to donate assets to a charity while retaining an income stream from those assets during your lifetime. It provides potential tax benefits and a way to support charitable causes.
6. Charitable Lead Trust (CLT): This trust provides income to a charity for a specified period, after which the remaining assets are passed on to non-charitable beneficiaries, typically family members. It can help reduce estate taxes.
7. Qualified Personal Residence Trust (QPRT): This trust allows you to transfer ownership of your primary residence or vacation home to beneficiaries while retaining the right to live in it for a specific period. This can help reduce the taxable value of your estate.
8. Family Limited Partnership (FLP) and Family Limited Liability Company (LLC): While not exactly trusts, FLPs and LLCs are often used in estate planning. They allow you to transfer assets, usually a family business or real estate, to the entity and then distribute shares to family members. This can help with tax planning and maintaining family control over assets.
9. Grantor Retained Annuity Trust (GRAT): This trust allows you to transfer appreciating assets to beneficiaries while retaining an annuity payment for a specific period. It’s often used for estate tax planning.
10. Dynasty Trust: This long-term trust is designed to pass wealth to multiple generations while minimizing estate taxes. It can provide ongoing asset protection and financial security for your descendants.
It’s important to work with an experienced estate planning attorney or financial advisor to determine which type of trust aligns best with your goals and financial situation. The suitability of a particular trust can vary based on legal, tax, and individual considerations.
The payment of expenses for land held in trust is typically outlined in the trust document. The specific provisions can vary depending on how the trust is structured and the preferences of the
grantor. Here are some general guidelines:
It’s crucial to carefully review the trust document to understand the terms and conditions related to expenses. If there are uncertainties or if you need clarification, it’s advisable to consult with the trustee or seek legal advice. Additionally, local laws and regulations may impact how certain expenses are handled, so it’s important to be aware of and comply with those requirements
Probate is the legal process by which a person’s will is proven to be valid and their estate is administered after they pass away. It is a court-supervised process that ensures that the deceased person’s assets are distributed according to their wishes as expressed in their will, or according to the laws of intestacy if there is no valid will. Here are some key aspects of the probate process:
1. Validating the Will: The first step in probate is to determine the validity of the deceased person’s will. This involves proving that the will was executed in accordance with the legal requirements of the jurisdiction and that it accurately reflects the person’s wishes.
2. Appointing an Executor: The court typically appoints an executor, also known as a personal representative, to manage the deceased person’s estate during the probate process. The executor is responsible for gathering the assets, paying debts and taxes, and distributing the remaining assets to the beneficiaries named in the will.
3. Inventory and Appraisal: The executor must compile an inventory of the deceased person’s assets and have them appraised to determine their value. This is necessary for the proper administration of the estate.
4. Notifying Creditors: Creditors of the deceased person are given an opportunity to make claims against the estate to collect any outstanding debts. The executor is responsible for notifying creditors and ensuring that legitimate claims are paid.
5. Payment of Taxes and Debts: Before distributing assets to beneficiaries, the executor must use the estate’s assets to pay any outstanding debts, including taxes, funeral expenses, and other liabilities.
6. Distribution of Assets: Once all debts, taxes, and administrative expenses have been paid, the remaining assets are distributed to the beneficiaries as specified in the will. If there is no will, state law will dictate how assets are distributed to heirs.
7. Closing the Estate: After all the necessary steps are completed, the court will issue an order to close the estate, and the probate process comes to an end.
Probate can be a time-consuming and costly process, and it varies from jurisdiction to jurisdiction. In some cases, it can be relatively straightforward, especially if the deceased person’s estate is small and there are no disputes among the beneficiaries. However, in more complex cases or when disputes arise, probate can become a more protracted and expensive process. As a result, some people take steps to avoid probate, such as creating living trusts or using other estate planning strategies.
Probate is necessary in many cases to legally transfer assets and settle the affairs of a deceased person. However, it is also possible to avoid probate or minimize its impact through various estate planning strategies. Whether probate is necessary or can be avoided depends on several factors, including the nature and value of the assets involved, the presence of a valid will, and the laws of the specific jurisdiction. Here’s an overview of when probate is necessary and when it can be avoided:
1. Presence of a Valid Will: If the deceased person left a valid will, it typically needs to go through probate to ensure the proper distribution of assets according to their wishes.
2. Real Estate Ownership: Real estate is often subject to probate, especially if it’s solely owned by the deceased person. However, some states offer simplified or expedited probate procedures for small estates or provide ways to transfer real estate outside of probate through mechanisms like transfer-on-death deeds.
3. Large or Complex Estates: In cases where the estate is large, complex, or involves significant assets, probate may be necessary to ensure that the assets are distributed in an orderly and legally compliant manner.
4. Disputed Wills or Beneficiary Disputes: If there are disputes among beneficiaries, challenges to the validity of the will, or concerns about the executor’s actions, probate may be needed to resolve these issues under the court’s supervision.
5. Creditors and Debts: Probate provides a mechanism for settling outstanding debts and claims against the estate, ensuring that creditors are paid from the deceased person’s assets.
1. Living Trusts: Creating a revocable living trust allows you to transfer assets into the trust during your lifetime. Upon your death, the assets held in the trust can be distributed to beneficiaries without going through probate. This is one of the most common methods to avoid probate.
2. Joint Ownership: Assets held in joint tenancy with rights of survivorship or tenancy by the entirety typically pass directly to the surviving joint owner without going through probate.
3. Beneficiary Designations: Accounts with designated beneficiaries, such as life insurance policies, retirement accounts, and payable-on-death (POD) or transfer-on-death (TOD) accounts, allow assets to pass directly to the named beneficiaries outside of probate.
4. Small Estate Procedures: Many jurisdictions have simplified probate procedures for small estates, often with a threshold based on the total value of assets. Estates below this threshold may qualify for a quicker, less costly probate process.
5. Gifting: Transferring assets as gifts during your lifetime can reduce the size of your probate estate. However, there may be gift tax implications to consider.
6. Estate Planning: Working with an attorney to create a comprehensive estate plan can help structure your assets and affairs in a way that minimizes the need for probate.
It’s important to consult with an attorney or estate planning professional who is knowledgeable about the laws and procedures in your jurisdiction to determine the best approach for your specific circumstances. The strategies to avoid probate can vary depending on your assets, your goals, and the legal requirements in your area.
***Please take a close look at this list.
Make your own list based on the items you own.
Especially look at numbers 5 and 6. There is documentation you must have in place to avoid probate for real estate and vehicles.
Here are common examples of assets that typically do not have to go through probate:
1. Assets in a Living Trust: Property held in a revocable living trust can be distributed to beneficiaries without probate. The trust document specifies how the assets should be distributed upon the grantor’s death.
2. Jointly Owned Property: Assets held in joint tenancy with rights of survivorship or tenancy by the entirety pass directly to the surviving co-owner(s) upon the death of one owner. These arrangements bypass probate.
3. Beneficiary Designations: Certain accounts and assets allow you to name beneficiaries, such as life insurance policies, retirement accounts (e.g., IRAs and 401(k)s), and payable-on-death (POD) or transfer-on-death (TOD) accounts. Upon your death, the assets go directly to the named beneficiaries.
4. Bank Accounts: Bank accounts with designated beneficiaries or held jointly with rights of survivorship typically pass outside of probate. Some states also offer “transfer-on-death” (TOD) bank accounts.
5. Real Estate with Transfer-on-Death Deeds: Some states allow for transfer-on-death (TOD) deeds for real estate, allowing the property to transfer directly to a named beneficiary without probate.
6. Vehicles with Transfer-on-Death Registration: A few states offer transfer-on-death (TOD) registration for vehicles, which permits the easy transfer of the vehicle to a named beneficiary upon the owner’s death.
7. Small Estate Procedures: Many jurisdictions have simplified probate procedures for small estates, typically with a threshold based on the total value of assets. If the estate falls below this threshold, it may qualify for an expedited, less costly probate process.
8. Community Property with Right of Survivorship: In community property states, spouses can hold property as community property with the right of survivorship, which allows the surviving spouse to inherit the property without probate.
9. Personal Property with a Spousal Property Petition: In some jurisdictions, surviving spouses can use a simplified probate process, often called a “spousal property petition,” to transfer personal property and some real estate without a full probate.
10. Exempt Property and Homestead Allowances: Certain states provide for the automatic distribution of exempt property and a homestead allowance to surviving spouses and minor children, without going through probate.
It’s important to note that the rules and laws governing probate and non-probate assets vary by jurisdiction. Additionally, the specific designation or titling of assets can affect whether they bypass probate. Therefore, it’s crucial to consult with an attorney or estate planning professional who is knowledgeable about the laws in your area to ensure your assets are structured in a way that aligns with your wishes and minimizes the need for probate.
Certain assets and property are typically subject to the probate process when a person passes away. Probate is necessary to ensure that these assets are distributed in accordance with the deceased person’s will or the laws of intestacy if there is no will. Common examples of assets that often have to go through probate include:
1. Solely Owned Bank Accounts: Bank accounts, such as checking or savings accounts, held solely in the deceased person’s name without designated beneficiaries or joint ownership, typically go through probate.
2. Personal Property: Personal possessions and tangible assets, such as jewelry, artwork, furniture, and collectibles, are part of the probate estate if there is no specific provision in the will or trust designating their distribution.
3. Investments and Securities: Investment accounts, stocks, bonds, and other securities registered in the deceased person’s name alone may be subject to probate.
4. Business Interests: Sole proprietorships and business interests owned solely by the deceased person may need to go through probate.
5. Intellectual Property: Intellectual property rights, such as patents, copyrights, and trademarks, are part of the probate estate if they are not specifically addressed in a trust or other estate planning documents.
6. Personal Debts and Liabilities: Probate is used to address the payment of outstanding debts and liabilities of the deceased person from their estate’s assets.
7. Unclaimed Property: Any property that was not designated to pass outside of probate or did not have a valid beneficiary designation typically becomes part of the probate estate.
8. Assets Without Beneficiary Designations: Assets that do not have designated beneficiaries or are not held jointly with rights of survivorship generally go through probate. This includes assets like certificates of deposit (CDs) and individual retirement accounts (IRAs) with no beneficiaries named.
9. Vehicles: In many jurisdictions, motor vehicles registered solely in the deceased person’s name may need to be transferred through probate.
It’s important to note that the rules and regulations governing probate can vary by jurisdiction, so what needs to go through probate can depend on the specific laws in your area. Additionally, the presence of a valid will can influence how assets are distributed through the probate process. If you want to minimize the assets subject to probate or have more control over how your assets are distributed, you can consult with an attorney to create an estate plan that addresses your specific needs and goals.
