The legally valid written instructions that a person creates describing how they want their money and property distributed upon their death. Wills are highly recommended, but there is no legal requirement to have one. To make a will legally valid, it must be properly executed in accordance with state law. Executing a will involves signing the document in front of witnesses. Additionally, at the time of signing, the creator must have capacity (i.e., be of sound mind).
An important part of being a responsible business owner includes developing systems to help other people operate the company without you. A business succession plan clearly states who will take over specific roles, hopefully reducing any potential disputes between family members or key employees. If the business is sold after a transition event occurs, a comprehensive business succession plan will also clearly outline the sale price and purchase terms.
Pension and retirement accounts form a large portion of an individual’s wealth. Thus, make sure you account for them in your estate plan. If a retirement account holder completes a proper beneficiary designation, their account assets will bypass probate. Account holders often designate a surviving spouse or children as beneficiary, but they could also name a trust or a charity.
Communication with attorneys is protected by attorney-client privilege, which ensures confidentiality. Most nonlawyers cannot offer the same level of privacy, potentially jeopardizing sensitive information and creating legal risks.
Depending on who your beneficiary is, some options might be a better fit than others. It is important that you understand who your beneficiary is, what their needs are, and what your desired outcome is.
To avoid any unnecessary complications in the settling of your affairs, take care to avoid ambiguous or unclear language in your will. If there are any doubts about your last wishes, the executor and beneficiaries may wish to consult with an estate planning lawyer to discuss next steps.
In movies and television shows, there is often a dramatic scene where family members gather in a lawyer’s office for the reading of the will. The atmosphere is usually tense, and everyone is eagerly waiting to find out who gets what.
Estate planning can be a complex process and facing it may seem impossible. To make it more manageable, break the process down into smaller, more achievable steps. Identify the first three steps and act.
The state may also have to get involved with choosing guardians for your children, authorizing others to act on your behalf, and deciding other important matters. The state’s decisions may be very different than what you would have chosen. In addition, a lengthy probate process can cause delays, increased expenses, and a loss of privacy. Having an up-to-date estate plan makes your wishes known and makes things easier for your loved ones.
As part of the estate planning process, you should discuss with your attorney the role they will play during your lifetime and whether they can also assist your loved ones with estate and trust administration when you pass away.
