Things Everyone Should Know About Estate Planning
Think about all the ways you try to protect your safety in day-to-day life – wearing a seatbelt when you are driving, making sure that the airbags in your vehicle function properly, having working smoke detectors in your home, and having renters/home insurance. These are just a few of the ways that average people protects themselves from injury, accident, or other unexpected life events. You are prepared for day-to-day emergencies, but are you prepared with someone to make medical decisions if you can not? Or someone who can take over your finances when you are unable to manage them? An estate plan can deal with these issues and more.
What is an Estate Plan?
Before you can have an effective estate plan, it is important to understand what that is. An estate plan is the method by which a person can dictate how his or her estate should be administered after death. It can also include contingencies for what should happen during one’s life should a person be unable to care for him or herself or make important decisions.
The most common part of an estate plan is a will. This is the document executed during one’s lifetime that dictates the way that assets will be distributed after death. The execution of a will has many strict requirements in the state of California. To ensure that it is properly prepared and executed, an estate planning attorney can help you.
While a will is the most commonly thought of estate plan, there are other components. A power of attorney is also part of an estate plan. This is legal documentation giving another individual power of attorney, or the ability to make decisions on behalf of another person. For example, a power of attorney can give another the ability to make financial determinations and health decisions.
How do I Set Up an Estate Plan?
The first step to establishing an effective estate plan is talking to an experienced attorney. An attorney will be able to explain the requirements needed for each element of an estate plan. The preparation of an estate plan begins with a discussion about what you want to happen with your assets following death. Your attorney will make sure that the documents are executed properly and will stand up to scrutiny of the court should there be any challenges.
Why Have an Estate Plan?
When people die without a will or any legal documentation describing what they want to be done following their death, they are leaving those decisions up to the courts. Probate is the process by which the courts will settle a deceased individual’s estate. If the deceased has a will, the court will verify the will and then the terms of the will are followed. Without a will or plan, the court decides how assets will be distributed. Without a will, or estate plan, you are leaving the future of your assets up to the courts. It is important to have an estate plan so that your wishes can be carried out after death.