Six Essential Tips for Effectively Planning Your Estate
“Live not as though there were a thousand years ahead of you. Fate is at your elbow; make yourself good while life and power are still yours.” ~ Marcus Aurelius
Drafting a Last Will and Testament, in addition to reviewing your assets and liabilities for a comprehensive estate plan, can be an uncomfortable experience because it is reminder that your time on this earth is finite. Many people mistakenly put off planning their estates thinking that it’s something “old people have to do.”
If you need a reason why estate planning is so important, look at pop icon Prince. He died at the age of 57 and left an estate valued at nearly $300 million, but with no will. As a result, his sister and five half-siblings are fighting over the fortune in court, according to Forbes Magazine. Once taxes and legal fees are extracted, Prince’s substantial estate may become paltry. This is a big reason why taking action now and having an estate plan in place is so critical – it can help prevent unnecessary stress and legal disputes between loved ones after you pass on. When you decide that planning your estate makes sense, here are six essential tips to ensure you have a legally valid, thorough estate plan:
1. Conduct a preliminary inventory of your assets and liabilities.
This is important so your St. Charles estate planning attorney can get a sense of your net worth and the composition of your estate. This inventory should also include any life insurance policies, retirement funds, stock options, pensions, etc. Having a clear picture of your estate can help a lawyer determine whether specific provisions are necessary. For example, a small, family-owned business will require a special provision in your estate plan.
2. Determine your beneficiaries.
Do you have a spouse? Children? Siblings? These are all potential beneficiaries of your estate and you need to have an idea of who gets what. You should schedule a time to sit down and talk with an experienced St. Charles estate planning lawyer because there are some important nuances of Missouri estate law you need to be aware of. For example, if leave a Will giving your spouse less than the “spousal share,” the spouse may elect to “take against the will.” The spousal share is set forth in Section 474.160 of the Missouri Probate Code. It stipulates that a surviving spouse is entitled to receive half of your estate if you left no living descendants (i.e. children). If you are survived by children, your spouse is entitled to one-third of your estate, along with certain exempt property and a 1-year support allowance.
As mentioned, if you leave your spouse less than the spousal share, they can affirmatively opt to receive the statutory share, if they elect to do in a specified time frame. You also need to know that a spouse cannot be completely disinherited from your Will unless you had a prior contractual agreement stipulating disinheritance (e.g., a prenuptial agreement that calls for the spouse to receive nothing).
3. Include a Durable Power of Attorney over Health Care
Establishing advance directives regarding future health care decisions is extremely important because the decisions associated with medical care often place tremendous strain on family members and friends. If you have a directive in place that stipulates who you want in charge of these decisions and how you want your care to be handled, it will be a tremendous relief for your family and ensure this difficult time is about honoring you, rather than bickering over care.
Here is a video discussing the importance of estate planning:
4. Determine who will manage your estate.
Whomever you select to be the executor of your estate will have tremendous power over your assets and liabilities upon your death. You can select virtually anyone to be the executor of your estate. You could select your spouse, a child, a sibling, a close friend, or even a corporation. Most importantly, it should be someone you trust and who you believe can effectively handle the responsibility of administering your estate.
5. Determine what type of plan makes the most sense.
Writing a Will makes sense, but writing a Will does not by itself avoid probate. Many people may be better suited for a revocable trust, especially if you own real estate, want to provide protections for your surviving spouse and children from involuntary creditors or divorces, or want to have the flexibility to make changes at any time. Trusts are a fantastic way to plan your estate without having to go through a lengthy probate process as well.
6. Find a qualified St. Charles estate planning attorney to advise you on your will and estate documents.
Polaris Law Group takes pride in offering an effective, full-service experience to our clients. If you want to ensure that you and your family are properly cared for, contact Polaris Law Group’s experienced trust and estate attorneys, Scott Stork and Raymond Chandler today. Scott and Raymond are seasoned estate planning attorneys and are members of the National Network of Estate Planning Attorneys, the National Academy of Elder Law Attorneys, and Elder Counsel. Schedule a meeting by phone or by filling out a quick contact form today.