What is an Estate Plan?
A proper estate plan involves establishing who will handle your affairs should you become incapacitated or die. It also determines who and when your heirs will receive your assets upon your death.
The best time to create an estate plan is when you are of sound mind and capable of thinking through these difficult decisions. If you don’t establish an effective plan before you become incapacitated, the State’s default rules will govern these matters. By having an estate plan, you control these decisions which will provide guidance and comfort to those around you as they will have a clear path to handling your affairs.
What Types of Items Are Included in an Estate Plan?
Within a well-executed estate plan, you will find directions regarding your health care decisions as well as financial decisions. In Georgia we use an Advance Directive for Health Care (for health care matters), a General Durable Power of Attorney (for financial decisions if you are incapacitated-but ceases when you die), a Last Will and Testament (for certain financial matters after you die) and frequently a Trust (for financial matters when you are incapacitated and die).
If your General Durable Power of Attorney is declined, (and your assets are not in a Trust) then a Guardianship will need to be filed to appoint someone to handle your affairs when you become incapacitated. The Guardian will be overseen by the local probate court for all these matters.
One additional piece of an effective estate plan is looking at the tax consequences and the costs to administer the plan as you establish the plan. Through proper planning you can control or at least minimize both of these.
What is a Will?
A will is your declaration of how you want some of your assets to be distributed when you pass away.
If you have minor children, your will also allows you to determine who will be their legal guardian should something happen to you unexpectedly. By planning ahead, you can help minimize the disruption in the lives of your minor children, while they, and your other loved ones are mourning.
You can also be very specific in your will and leave instructions for those left behind. This can cut down on confusion and disputes.
Having a will in place is a great first step, but it is just the beginning of some steps you can take to ensure your family is taken care of in the best way possible.
What Additional Steps are Taken to Create an Estate Plan?
Creating an estate plan is more than just having a will. It involves taking a complete inventory of your assets and debts. By having a clear picture of where your life is today, you can use this to put together an effective estate plan with a professional that will cover all critical aspects of your life.
Go over your specific concerns and wishes with your estate planning attorney. Will your family have enough to survive from your life insurance policy, or do you need to supplement? Each family is different and will have other goals. By talking with an estate planning attorney, you can gauge what you need and where there may be opportunities for extra protection for your family.
Make choices about who will be responsible for dividing your assets or overseeing essential decisions. Also, make choices about who will provide for your minor children if necessary.
Decide who will be in charge of making medical or financial decisions on your behalf when you cannot do so either due to your incapacity or death. This step can be difficult for some, as the person they choose will inevitably face some complex decisions, and they need to be able to make them even under emotional stress.
Designating beneficiaries is also an important aspect of estate planning. Naming beneficiaries or contingent beneficiaries can help the people entrusted to avoid lengthy probate issues or, in some cases, taxes on the assets that are distributed to them. Don’t make the mistake of designating minors as a beneficiary. Make sure you understand the tax consequences of your choices.
Work with an experienced and trusted estate planning attorney to ensure all aspects are covered and the estate plan is practical and straightforward. In their years of training, they have faced issues and will have strategic information to help ensure your loved ones are cared for to the best of your ability.
Estate plans must be written. Each document in the estate plan has its own rules regarding how it must be signed, and how many witnesses it must have. Failing to follow these rules can make the document not effective.
Lastly, inform the people you have chosen to assist you with your estate plan so they know their duties and responsibilities should something happen to you. It is also essential for them to be able to easily access copies of your estate planning documents when they need to serve.
Who Needs an Estate Plan?
The short answer is everyone. Regardless of the assets involved in your estate and their value, it is always a good idea to determine who will be responsible for tying up loose ends when something happens to you, and you can no longer make decisions.
It is also vital to have someone you can depend on to be in charge of making important decisions on your behalf regarding financial and medical decisions. Part of an estate plan is carefully selecting those you can trust and granting them the powers to help you out when you cannot help yourself. If you don’t proactively make these choices then your decisions will be made by the people designated by the default rules in Georgia.
Why Work With an Estate Planning Attorney?
Estate planning attorneys are well-versed in state laws as well as the tax rules. If you are open with them, they can help head off potential issues and make sure there are no holes in your plan. They can also help you create a plan for keeping your estate plan current. The best attorneys will also help you think through aspects of your estate that you may not have yet realized.
Some people try to put together their estate planning documents themselves, which is an option. However, if the paperwork isn’t sufficient, it may render the planning ineffective, or there may be unnecessary tax implications left for your family that could have been avoided or unnecessary administrative costs that could have been easily avoided.
Call our office today at 770-285-5493 to learn how we can best help protect you and your family moving forward.