Introduction to Wills and Estate Planning

By Cindy R.

Estate planning is the process of putting a plan together to take care of your family and you assets when you die. No matter how little you may have in assets it is important to have a estate plan in place. Key elements of an estates plan include a will, powers of attorney and possibly trusts. We'll cover each of these in turn

A will is the first place to start your estate plan. You need to create a list of all of your assets and determine who you would like to receive those assets after your death. Your will is the legal document that lists your assets and who is to receive them. When drafting your will pay special attention to the probate laws of Texas to ensure that your will can be validated in probate court. If your will is disallowed then your property will be distributed without your will and according to Texas probate law. This is not something you want to take the chance of messing up so enlisting the aid of an estate planning attorney is a smart move. They can usually assist you for a reasonable fee.

Power of Attorney - A power of attorney is a legal document that authorizes somebody to act on your behalf in legal or business matters. A durable power of attorney is a special kind that allows the rights granted to be effective if you become incapacitated due to injury or mental illness. Durable powers of attorney can by financial and medical in nature. A Health Care Power of Attorney is a durable power of attorney that authorizes the appointed agent to make health care decisions for up. The authorization can include the ability to stop life sustaining medical support if it is keeping a terminally ill patient alive.

A living will goes hand in hand with a medical power of attorney. A living will states your intentions regarding health care if you are not capable in do so for yourself due to a future incapacity. The living will states WHAT you want done in specific situations and the health care power of attorney authorizes somebody to follow through on your wishes. These two documents are complicated enough that most are crafted by professional estate attorneys.

Next we are going to cover Trusts. Trusts are another vehicle that allows you to direct certain types of property with the added benefit that you can place restrictions and requirements on the assets. One of the most significant advantages of trusts is that there is no court involved. This allows for immediate dispersal of assets by the trustee (the person administering the trust). Because there is no probate court involvement trusts can also bypass public record of the transactions.

Lastly we are going to cover some of the tools that are available to help manage your tax burden upon your death. Life insurance is one of the primary methods to manage taxes at time of death. There are also a large variety of trusts that are effective as well. Estate planning for tax consequences is one of the more complicated aspects of estate planning and a professional can help you craft an appropriate plan.

Now that you are familiar with some of the estate planning tools it is time to start the process. Whether you go it alone or enlist the help of a professional the first step is to create a list of all of your assets. Once you have your list of assets you will need to make a decision about what you'd like to happen to each asset upon your death. Should it go to family, your alma matter, your favorite charity or someplace else that is near and dear to you?

Estate planning can seem like a daunting undertaking, but knowing that it is very important and taking it one step at a time will help you complete the process. Hiring professionals to help you in the process is also extremely helpful and highly encouraged. - 23200

About the Author:

Visit the Texas Wills web site where Cindy R. writes about Writing A Will and other estate planning topics.