What is Estate Planning
Estate Planning involves the creation of several legal documents to manage your affairs and personal assets in the event of incapacity or death.
WHAT DOCUMENTS MAKE UP AN ESTATE PLAN?
There are several documents that can make up an Estate Plan and each plan will be tailored to the specific situation. The most common documents are: Will, Trust, Power of Attorney, Health Care Directive, Beneficiary Designation Language for Non-Probate Assets, Digital Asset Authorizations, and Real Estate Deeds.
WHEN SHOULD SOMEONE COMPLETE AN ESTATE PLAN?
Once a person reaches legal adulthood, age eighteen (18), it is a prudent idea to work with an Attorney to put an Estate Plan together. Since a legal adult is no longer under the legal guardianship of their parents, having these Estate Plan documents in place will ensure the right people, such as their parents, have the legal authority to help their adult child should something like incapacity take place.
WHAT IS A WILL?
A Will is a legal document that can do many things such as: distribute your assets upon your death according to your wishes, name beneficiaries for those assets, appoint guardians for any minor children you may have, and designate a Personal Representative (also known as an Executor) to make sure your Will is executed according to your wishes, in the event of your passing.
WHAT IS A TRUST?
Revocable Trusts or Living Trusts are legal tools that can be used for a variety of reasons such as to avoid Probate, manage wealth, protect privacy, and more. When you create a Trust, you transfer your ownership of property from yourself to the Trust as the new owner. The Trust is then managed for the benefit of a beneficiary. Oftentimes, you will remain the Trustee and the beneficiary of the Trust until your passing.
WHAT IS A POWER OF ATTORNEY?
A Power of Attorney is a legal document that allows you to designate a person you trust to act on your behalf regarding legal and financial matters. The person, or people, you designate to act on your behalf are called Attorneys-in-Fact. If multiple Attorneys-in-Fact are named, you can choose if you would like them to act jointly or you may authorize them to act independently.
DOES A POWER OF ATTORNEY DOCUMENT GIVE MY ATTORNEY-IN-FACT THE ABILITY TO MAKE HEALTH CARE DECISIONS FOR ME?
No. Attorneys-in-Fact do not have the power to make health care decisions for you. You can decide who you want to make your health care decisions for you in a separate document known as a Health Care Directive.
WHAT IS A HEALTH CARE DIRECTIVE?
A Health Care Directive is a legal document that gives someone else – called a Health Care Agent – the right to make decisions about your health care, in the event you are not able to communicate or make decisions for yourself. A Health Care Directive also allows you to indicate your preferences for organ donation and disposition of your body after death (burial, cremation, “human composting,” etc.).
DO MY ATTORNEY-IN-FACT AND HEALTH CARE AGENT HAVE TO BE THE SAME PEOPLE?
No. You can choose different people for these roles. It’s important to consider naming multiple people, in succession, as your alternates.
HOW LONG ARE MY ESTATE PLANNING DOCUMENTS VALID?
Your Estate Planning documents don’t carry an expiration date and will remain valid unless you make changes or want to revoke (cancel) one of the documents.
CAN I MAKE CHANGES TO MY ESTATE PLANNING DOCUMENTS?
Yes. Many people make changes to their Estate Planning documents over the course of their lifetime.
HOW DO I MAKE A CHANGE TO MY ESTATE PLANNING DOCUMENTS?
If you’d like to make a change to any of your documents please contact me, as the changes should be made by a licensed Attorney.
Included in my Estate Planning services is a complimentary check-in with my clients every three (3) years. This check-in serves as a reminder to you to review your plan and think about if anything has changed. An example of a change would be if you got married or divorced, or if you bought a cabin in Wisconsin. If so, we can meet to review any potential changes needed for your legal documents. If no changes are needed, then I will check back in with you in another three (3) years for the same process, and so on. There is no cost for this review. Charges are only incurred when/if changes to the documents are necessary.
WHAT HAPPENS IF I PASS AWAY AND DON’T HAVE A WILL?
Each state has their own laws in place for this situation and your assets would be distributed according to those laws. An experienced Attorney can help you understand what that would mean for your situation. However, having a Will in place ensures that your assets will be distributed according to your wishes, and not the state’s statute. Plus, not having a Will often requires a Probate proceeding in the courts.
I HAVE A WILL THAT I CREATED WITH A DIFFERENT ATTORNEY, BUT I WANT TO MAKE CHANGES AND DON’T WANT TO WORK WITH THAT ATTORNEY ANYMORE. CAN I WORK WITH YOU ON A NEW WILL?
Absolutely. It is your right to hire and retain the Attorney you’d like to represent you in your Estate Planning needs. If you find yourself in this situation, please reach out to me and I will advise on appropriate next steps.
DO I NEED A TRUST?
Determining your potential needs for a Trust is part of the service I provide in our initial client meeting, free of charge. After learning more about your goals and situation, I’d be happy to provide my guidance on the reasons why I would or would not recommend establishing a Revocable / Living Trust based on your particular situation.
WILL MY ESTATE OWE TAXES UPON MY DEATH?
Minnesota is one of several states that has an Estate Tax. This Estate Tax only applies to Estates worth more than three-million-dollars ($3,000,000), per person. Therefore, if you are a married couple, you are eligible for a six-million-dollar ($6,000,000) exemption before Minnesota Estate Taxes would take hold. If you think you might fall into this category, there are tax efficient strategies we can utilize to make the most of your Estate and shield it from state taxes.
WHAT IS ESTATE ADMINISTRATION?
Estate Administration is the process of managing and distributing a deceased person’s assets upon their death. Partnering with an Attorney for this process can be invaluable so they can guide you through this process.
WHAT IS PROBATE?
Probate is the legal process of administering and settling a deceased person’s Estate under court guidelines, whether or not the deceased person had a Will. In Minnesota, there are specific triggers for Probate and many people welcome the experience of an Attorney to help them navigate this process.
WHY DO PEOPLE WANT TO AVOID PROBATE?
Since Probate is a legal process, it can be complicated to navigate on your own without an Attorney. Additionally, Probate can take may months to complete and often, the Estate’s assets are not available until Probate is completed. This can create financial difficulties or create extra strain on families trying to settle the Estate of their loved one. Simply put, Probate costs money, time, and energy.
Additionally, Probate is a public process, meaning that Court documents are available for the public at large to access. Many times, people wish to avoid Probate to keep their matters private.
HOW DO I AVOID PROBATE?
There are several ways to avoid having your Estate go to Probate and thereby, simplifying and easing the process for your loved ones upon your death. Developing a strategy to avoid Probate is something I do with many of my clients. I would be happy to speak with you to see if this applies to your situation during a complimentary introductory meeting.
HOW DO YOU CHARGE FOR YOUR SERVICES?
For Estate Planning documents, I charge a flat fee. This fee will be communicated to you up-front after our initial no-cost client meeting, once I can determine the best plan for you.
For Probate Administration services, I charge an hourly rate. Again, this fee will be communicated to you up-front after our initial client meeting once I can assess the situation and give you an estimate of how much time I think it will take to resolve your particular matter.