What is Estate Planning?
If you have a career, a spouse, children, assets, or any combination of these things, you have an estate, and should consider whether now is the time to create an estate plan. At its simplest, your estate plan refers to your wishes regarding your financial legacy (regardless of how basic or substantial) and your wishes regarding how your financial legacy will flow to your loved one when the time comes.
Although that time may be in the very distant future, that is the crux of planning – taking care of the matter before your plans are required. The best planning strategy for your estate is getting an early start and making modifications as necessary. What is estate planning? The dedicated Texas estate planning attorneys at Ibekwe Law, PLLC (512-505-2753), have the experience and legal insight to answer this question for you in relation to your unique estate planning needs.
What Is Included in an Estate Plan?
Your estate amounts to your assets in their entirety. However, an estate plan also includes planning for the possibility that a person will have an accident or illness that will render them unable to make decisions on their own behalf. An estate plan also includes making determinations regarding guardianship of minor children, or appointment of certain persons to make legal or medical decisions on your behalf.
Making plans for all of these instances can provide you with considerable peace of mind. You work hard for your loved ones, and passing on the fruits of your labor is your final reward. Additionally, making health and financial decisions, as well as decisions regarding minor children, can ensure that your wishes are carried out should you become incapacitated or pass away.
Assets Included in an Estate Plan
Estate plans are composed of all of a person’s assets, which can include the following:
- Your home and its furnishings
- Your vehicle
- Any other real estate you own
- Your bank accounts
- Your retirement accounts
- Your life insurance policies
- Hard to value assets, such as collectibles (stamps, paintings, etc.)
- Your personal possessions, including any items of uniquely personal value to you and your loved ones (such as family heirlooms)
Creating the right estate plan for you requires a solid understanding of your estate, and the experienced estate planning attorneys at Ibekwe law can help answer your questions and ensure your legal and financial wishes are carried out with respect to your assets.
Considering Your Estate Plan
While your estate plan is likely to include a Last Will and Testament (will) that can identify which properties will go to whom upon your death, there may be far more to your estate plan than just a will.
Your estate plan may also address who you want your assets to flow to and when you want them to be distributed – in addition to other important decision-making concerns – all while keeping the tax implications for your loved ones as low as possible. Consider all the following potential elements of your estate plan (in addition to the basics):
- Addressing the matter of a guardian for your minor children and the matter of their inheritance
- Providing for any family members with special needs (while ensuring this does not disqualify them for government benefits)
- Providing for loved ones who may be less financially savvy and/or who may be vulnerable to debtors and/or to divorce
- Setting up instructions regarding who will be making your healthcare and/or financial decisions in the event you are incapacitated (known as power of attorney)
- Setting up the transfer of your business upon your retirement, disability, incapacity, or death
- Ensuring that the tax expenses, court costs, and legal fees associated with your estate plans are minimized
If a person does not establish an estate plan, their assets will be distributed according to the state’s intestate laws. In these cases, there is no certainty that the wishes of the deceased will be carried out. A well-prepared estate plan carefully delineates your intentions in a manner that leaves no room for questions, misunderstandings, or mysteries – by the most tax-advantageous means possible – when the time comes for your plans to be implemented.
Common Legal Documents Included in an Estate Plan
What is an estate plan? The answer is different for every individual. Some of the common legal documents included in an estate plan include the following:
Last Will and Testament
Your will is a legal document that outlines your last wishes as they relate to your estate (or assets). If you have a will, your estate will go through the probate process.
A trust is a legal tool that allows you to hold assets in a trust fund – to be distributed to your assigned beneficiaries via a third-party who is known as the trustee. There are different types of trusts including revocable trusts, irrevocable trusts, gun trusts, and special needs trusts.
Guardianship refers to assigning a guardian for your minor children in the unlikely event that they are left without either parent. Guardianship is typically addressed in one’s will.
Financial and Durable Powers of Attorney
Your financial power of attorney is a legal document that grants someone else the power to make financial decisions on your behalf in the event that you are unable to do so. A durable power of attorney, on the other hand, is a legal document that grants another person to make decisions on your behalf as they relate to issues that do not involve your finances or health care.
Advance Healthcare Directive
An advance healthcare directive (AHCD) consists of both your living will (which allows you to specify your end-of-life medical preferences) and your medical power of attorney (which allows you to designate someone whom you trust to make medical decisions on your behalf in the event that you are unable to do so).
Turn to an Experienced Texas Estate Planning Attorney for the Legal Guidance You Need
What is estate planning? The question is complex, and the answer will be different for every individual. The trusted Texas estate planning attorneys at Ibekwe Law, PLLC are prepared to answer your questions and to help you through this process. Your estate plan represents your legacy, and we want to partner with you to ensure your wishes are carried out accurately. For more information about how we can help, please do not hesitate to contact or call us at 512-505-2753 today.