Friday, August 28, 2015

Tips, Tricks and Essentials of Estate Planning (PART 2)


Cathy R. Robinson, CPA
Senior Manager
robinson@hwco.com
 
In Part 1 of Tips, Tricks and Essentials of Estate Planning the four essential documents the CPAs and advisors at HW&Co. most recommend were covered. To recap the list, the essentials were having a will, having durable power of attorney, medical power of attorney, and finally, a directive to physicians or a living will.

So what else can you do to better prepare yourself for planning your estate?  There are additional highly recommended items you should look into. They are: 

A  Trust

You should create a trust while you are alive. Finding a reliable, trustworthy trustee is the second step. This person will manage the property according to legal duties and your instructions. They distribute the assets to the beneficiaries according to your instructions.  So why invest in a trust? The first reason is so that it can help you to provide for and protect a beneficiary. Secondly, the flexibility of asset distribution can help to spread benefits over time. Your instructions will govern who receives the assets of the trust and the amount they receive, while also setting standards and conditions. Finally, a trust can help to protect against your own incompetence. Should something happen with your mental state the trust will already be in place with clear concise orders to help take care of your loved ones.  

It’s important to also be aware that while trusts can be very helpful, they are not always worth the cost, expense and hassle that come with them. You should also look out for the trust “seminars” sponsored by companies claiming to prepare trusts. These people are often not licensed attorneys. Avoid the scam and seek out a professional.  

Self-Designation of Guardian

With this document, you can name the person whom you would want appointed to be in charge of your minor child(ren.) A guardian is the person who will be legally responsible for the personal affairs, health, and well-being of a minor. In some states, you can also disqualify people you do not want appointed.  

Organ Donation

If you are someone who would like to donate your organs, you should have clear documentation and instructions. This can be as easy as going to the DMV to have it placed on your driver’s license. If you do not make this decision for yourself, your family will reserve the right to make the decision for you.  

There never seems to be an ideal time to plan your estate, but it is important to have a plan. These useful documents can help to make things easier on your loved ones, while ensuring your wishes are being carried out accordingly. It is also recommended to seek professional advice as to meet your goals.