What Documents Make a Successful Estate Plan
It is worth noting that every estate plan is different. The facts and circumstances that make your family unique are the same facts and circumstances that will make your carefully crafted estate plan unique. Simply put — your estate plan should be as unique as your family.
Estate planning involves many considerations, including reviewing and analyzing everything from your family’s medical conditions and considerations to the businesses that you own and your investments. However, an effective estate plan should never be thought of as the documents prepared by your estate planning lawyer. An effective estate plan is the time and energy that your estate planning lawyer spends investigating and discussing what exactly makes your family unique.
What Documents Should Be Included in My Estate Plan
What is a Will?
A Will is a legal document that is written to specifically detail exactly what you would like to have happen with your property, money, and assets upon your death. Moreover, a Will is required in North Carolina to be executed in a specific way. The requirements for executing a binding and enforceable Will are outlined within the North Carolina General Statutes.
As a practical matter, a Will can help you and your family avoid complicated issues and familial contention over what should happen with your property, money, and assets upon your death. Additionally, a properly executed Will can help your family avoid the costly and time-consuming process of probating your estate.
In North Carolina, a person who dies without a Will in place is said to have died intestate. A person who dies intestate in North Carolina will have their assets and belongings divided pursuant to state statute. The intestate statutes can be unforgiving and even unfair. For example, a child with drug dependencies who has not made any effort to interact or help would inherit as much as the child who was the primary caregiver of aging parents. If you want to avoid these statutes, you must draft and execute an effective Will.
What is a Power of Attorney?
In North Carolina, a Power of Attorney is a document that permits a person, called the “Principal,” to give a trusted third party, called the “Agent,” specifically enumerated powers and authority so that they may make decision on their behalf. Simply put, a Power of Attorney is a document that grants someone authority to make decisions on your behalf.
The important and often overlooked value of a Power of Attorney document is that it can be written to grant as much authority to the Agent as the Principle is comfortable with. As such, it is essential that whomever you chose to become your Agent is someone that you trust to put your interests before their own.
WARNING – It is very common that Agents, who are not carefully selected, will abuse the authority that has been given to them resulting and costly litigation and unnecessary expense. Please be careful when selecting someone to serve as your Agent.
It is worth noting that some Powers of Attorney may end if you become incapacitated or are declared incompetent. Consider speaking with one of our experienced and knowledgeable estate planning lawyers about whether a Durable Power of Attorney may be right for you.
What is a Trust?
The idea of Trusts or Trust Funds sounds vastly more complicated than they actually are. Essentially, a Trust is an arrangement that allows a third party, or Trustee, to hold, protect, and spend assets (such as money, investments, or even real property) on behalf of a third party, called a Beneficiary. Simply put, a trust is a fiduciary arrangement where a trustee holds assets for the benefits of a designated Beneficiary.
Since Trusts can be effective vehicles for avoiding probate, a well planned and funded Trust can ensure that your beneficiaries gain access to their assets more quickly than they might if they had to navigate the complexities of the probate process.
By passing outside of the probate process, your family can save time, attorneys fees, court costs, and possible taxes.
There are many kinds of trusts that may benefit your family. If you are considering creating a trust, consider speaking with one of our experienced Durham Estate Planning Lawyers.
Questions to Ask Yourself, or Your Lawyer, About Your Current Estate Plan
Question 1 – Has your current estate plan been reviewed in the last two years? Even if we assume that there have been no family or financial changes in the last two years, there have been significant changes in the law that may cause your estate plan to be less effective. An out-of-date estate plan could do more harm that no estate plan at all.
Question 2 – Does your estate plan contemplate incapacity?
Question 3 – Does your estate plan take steps to avoid possible Will contests and related disputes after your death and during the administration of your estate?
Question 4 – Does your estate plan protect your children’s inheritance in the event your surviving spouse remarries in the future?
Question 5 – Have you checked the designation of beneficiaries to your retirement accounts and life insurance policies within the past twelve months?
Question 6 – Are you confident that the persons you named as guardians of your minor children in your current plan is still the best person for that position?
Question 7 – Are you confident that the persons selected as executor and trustee in your current estate plan is still the best person for that position?
Question 8 – Are you confident that your executor, power of attorney, and successor trustee are prepared to act on your behalf and in your best interest when asked to?
If you have answered “No” to any of these questions, you should schedule a no cost, no obligation, estate planning consultation to address the issue immediately.
Contact Our Estate Planning Attorneys Today
Whether you need help creating an estate plan, updating an existing plan or simply reviewing your current plan from another state, our team of passionate estate planning lawyers can ensure that your family is covered. Contact us at (919) 584-5556 or schedule a meeting by clicking this link.
