What Estate Planning Documents Do I Need?
Estate planning is not one-size-fits-all. Many people have different needs when it comes to securing their assets for future generations. Therefore, determining which estate planning documents you will need will depend on many factors. Attorney Farren Sheehan offers a variety of estate planning services and provides one-on-one legal guidance. She has developed a list of essential estate planning documents that are commonly used by Texas residents.
Last Will and Testament
A last will and testament is a legal document detailing what happens to your assets after you pass away. It will contain a list of your beneficiaries and designate their shares of the estate.
It will also identify someone as the executor of your estate. This person will act as your representative upon death and carry out your wishes.
Additionally, creating a will allows you to choose a new guardian for any dependents that you may have, including children and pets.
All wills are subject to a legal process called probate. During the probate process, a court will determine the validity of your will, identify your current assets and remove any remaining debts or taxes owed. Once this process concludes, the beneficiaries will receive their shares of the estate.
Revocable Living Trust
A revocable living trust offers an alternative to a last will and testament. A trust gives you the opportunity to use your assets while alive and transfer them to your beneficiaries after you pass away.
Like a will, trusts detail how your assets will be divided among your beneficiaries. These wishes can be executed right away or upon your death. A trust also allows you to name a trustee who will oversee the distribution process. The majority of people chose themselves as the trustee while living, and designate another person or entity to take over once they pass away.
Unlike a will, trusts do not undergo the court-sanctioned probate process. Instead, the trustee is responsible for the trust administration process. He or she is in charge of contacting the beneficiaries and updating them about the process. He or she will also locate and transfer shares of the estate, and file the appropriate records.
There are several advantages associated with forming a revocable living trust. Since living trusts are not subject to the probate process, the distribution of your estate will not become a part of the public record.
Avoiding probate may also save you time and money. The courts will typically take longer to process and distribute your assets. They also charge fees for doing so.
Finally, revocable living trusts offer you flexibility, since they can be altered or eliminated whenever you wish. However, if you choose to create an irrevocable living trust, then you forfeit the option to make any important changes. You should always speak to an Austin estate planning attorney before deciding which version of a living trust is right for you and your family.
Durable Power of Attorney
Any well-balanced estate plan should contain a document identifying who will make financial and legal decisions for you if you become mentally incapacitated. This document is called a durable power of attorney.
If you fail to establish a durable power of attorney, then the courts could potentially decide what to do with your assets if you are unable to do so. The decisions they make may not coincide with how you wanted your assets to be managed.
For many families, it may be wise for spouses to set up reciprocal powers of attorney. However, there are situations where you might want another family member or a friend to take on this role. You should consult with an Austin estate planning lawyer to determine which path best suits your needs.
Medical Power of Attorney
A medical power of attorney, also known as an advanced medical directive, allows you to appoint someone you trust to make medical decisions for you if you are unable to do so. It gives your caretaker and medical professionals guidance on how to proceed when you become incapacitated.
When choosing a medical power of attorney, you should select someone that you trust and has a similar worldview to your own. This person will have your life in his or her hands, so think carefully before making any final decisions. You should also select a backup candidate in case your first choice is unavailable or unable to perform the job.
Finally, make sure that your medical power of attorney has access to your complete medical history by including a Health Insurance Portability and Accountability Act (HIPAA) privacy waiver. This will help your medical power of attorney make informed decisions on your behalf.
Contact Our Austin Estate Planning Lawyer for an Initial Consultation
Estate plans will vary from person to person. Figuring out the exact details of your estate plan will depend on the size and value of your estate, your wishes and your personal circumstances. However, there are certain estate planning documents that create a solid foundation for any individual estate plan.
Attorney Farren Sheehan of Sheehan Law, PLLC has extensive experience helping Texas residents plan their estates. Please reach out to her with any questions or concerns about your estate planning needs. Consultations can be set up online or by contacting our office at (512) 640-0588.