Estate planning attorneys emphasize the importance of personalized attention, because each family is different. There is no one set estate plan that is right for everyone, and this is why you should discuss your unique situation with a licensed lawyer from our firm.
The above being stated, there is a basic framework that is applicable to everyone, and we will take a look at it here.
Asset Transfer Method
Clearly, the facilitation of postmortem asset transfers is at the core of the estate planning process. Most people aware of this, and most individuals who have not looked into the subject thoroughly assume that it is resolved as soon as you execute a last will. In reality, this is an oversimplification.
Yes, you can use a last will as a vehicle of asset transfer, but there are other options. Some of them exist to address somewhat complicated and/or unusual circumstances, and we will get into them in subsequent blog posts.
For our purposes here, we will explain the value of a revocable living trust as an alternative to a last will.
The first thing you should know about a revocable living trust is that you don’t lose control of the assets that you convey into it while you are alive and well. When you look at the name, you see that you can revoke it entirely and it would no longer exist. You would then re-assume direct personal ownership of assets that you conveyed into the trust.
If you establish a living trust, you are probably not going to dissolve it, because the whole point is to use it as an estate planning device. Still, you don’t lose control, because you can act as the trustee and the beneficiary throughout your life. You can take assets out of the trust as you see fit, and you can convey property into the trust at any time after it has been established.
One major benefit that you gain with a living trust over a last will is the avoidance of probate. This is a costly and time-consuming legal process that takes place under the supervision of a court. It is also a public proceeding that allows anyone who is interested to find out how your resources were distributed.
These negatives are completely avoided when a living trust is used, because the trustee who you name to succeed you can distribute assets to the heirs who are named in the document outside of probate. You can include a spendthrift clause if you have concerns about the monetary decision-making of a loved one, and this is another benefit.
Nursing Home Asset Protection
Most senior citizens will need long-term care eventually, and Medicare will not pay for a stay in a nursing home or assisted living facility. Medicaid will cover these costs, but since it is a need-based program, it takes careful planning to qualify without losing anything in the process.
In order to be able to leave behind a decent legacy for your loved ones to draw from after you are gone, you have to do what you can to protect your assets from devastating nursing home costs. We can help you do just that.
A well-constructed estate plan will include an incapacity planning component. You can use documents called durable powers of attorney to name agents to make medical and financial decisions on your behalf in the event of your incapacitation. Through the inclusion of a living will, you can state your life-support preferences as well.
Another advantage that you gain if you use a revocable living trust instead of a will is the ability to prepare for possible incapacity in your life. You could name a disability trustee who would be empowered to manage assets in the trust if you ever become unable to do so on your own.
We Are Here to Help!
Our doors are open if you would like to discuss your estate planning objectives with a licensed attorney. You can send us a message through our contact page to request a consultation appointment, and you can reach us by phone at 913-262-2000.