Five Elements of a Comprehensive Estate Plan
Getting your estate plan together is an important step you can take to provide for your family. With a comprehensive estate plan, you can work ahead to lessen their burdens when your health declines to the point of incapacity or when you pass away. Here are five important components of a comprehensive estate plan.
1. Will or Revocable/Living Trust
Most comprehensive estate plans are either will-based or trust-based. A will must go through the probate process; however, the court (in Virginia it is assigned to the Commissioner of Accounts) must follow the instructions and designations you have made in the Will. A trust, on the other hand, does not go through the probate process; rather, your successor trustee oversees your estate, using your trust provisions for instructions on asset management and distributions to your beneficiaries. Your estate planning attorney will guide you to the best plan for your individual circumstances, based on your goals, wishes and dreams.
2. Other Trusts
Even if your comprehensive estate plan is trust-based, your situation may call for additional trusts. For example, you may want to create a Special Needs Trust for an individual with a physical or cognitive impairment. Or you may want to use some Irrevocable Trusts for asset protection purposes such as a life insurance trust, IRA trust or gifting trust. There are many types of trusts available to handle specific assets and circumstances.
3. Healthcare Powers of Attorney and Living Will
Memorializing your healthcare wishes are also important in case you become incapacitated. These two documents, used together, will help you express your wishes and appoint a decisionmaker should you lose your capacity to make your own healthcare decisions. It is important to note that this appointment only lasts as long as your incapacity.
• Living Will
A living will is a document that reflects your instructions about your preferences about end-of-life decisions such as continuation of life support.
• Health Care Power of Attorney
Your healthcare power of attorney designates someone to make medical care decisions on your behalf if you become incapacitated. This person is known as your agent.
4. Financial Power of Attorney
Similar to the Health Care Power of Attorney, the financial power of attorney designates someone to manage the finances on your behalf if you become incapacitated, such as paying your bills and managing your assets.
5. Regular Review
Here is an important element to a comprehensive estate plan that some people overlook. Regular review. Tax laws change. Your financial situation may change. Your health status and healthcare wishes may change. Some institutions may refuse to recognize a Power of Attorney after a year or so. Regular review of your estate plan is essential so that you can be sure you are passing as much wealth on to your beneficiaries as possible and that your current healthcare and financial wishes are accurately reflected and the legal documents will work when you need them to be honored. Some estate planning attorneys offer yearly maintenance plans, in order for you to be assured that your comprehensive estate plan is up to date.
Work with an experienced Virginia estate planning attorney.
We collaborate closely with our clients to create a comprehensive estate plan that is customized to their situation. We offer a maintenance plan to ensure that plan remains up to date with current law and your personal needs and wishes. Contact Wilson Law PLC today at 866-603-5976 to set up a meeting or fill out our contact form and we will call you to schedule your meeting.
