SIMPLY PUT “ESTATE PLANNING” IS THE PROCESS OF MAKING SURE YOUR ASSETS PASS TO WHOMEVER YOU WISH TO DESIGNATE AS QUICKLY AS POSSIBLE WITH THE LEAST AMOUNT OF COSTS AND DELAYS.
If you fail to plan your estate will go thru the Probate process. This means retaining a lawyer, paying court costs and legal fees. The process can take from six months to a year before your assets are finally distributed to your heirs.
With careful planning Probate can be avoided. This usually means creating a Revocable Trust or making sure beneficiaries are listed on all your financial accounts. You also need to provide for disposition of your real estate by placing your home into the Revocable Trust or thru the use of certain kinds of Quit Claim deeds.
Estate Planning also includes planning for incapacity. If you are mentally or physically incapacitated this can result in creating a legal Guardianship. Through proper planning Guardianships can be avoided with Health Care Surrogates and Powers of Attorney’s.
Only with proper planning can you avoid Probate. If you fail to plan, your estate will most likely go to Probate Court. Proper planning means:
- Understanding how a joint account affects your estate.
- The difference between joint tenants with right of survivorship and Tenants in Common.
- Understanding the effect of naming a beneficiary on your bank or brokerage account.
- Understanding the effect of naming a beneficiary on your annuity or life insurance.
- Understanding what happens if your beneficiary predeceases you.