A person's estate consists of all the personal belongings, assets, business holdings, and financial resources an individual owns. An estate can include real property, chattel, possessions, investments, interests in a corporation, rites from a laws suit or structured settlement, or funds in the person's name, held in partnerships or joint ventures, through a trust, or joint ownership arrangement. Estate planning is the process of accounting for the accumulated assets of an estate and arranging for the distribution of those assets in order to achieve the wishes of the estate owner.
Good estate planning will considerably reduce the possible taxes and fees associated with probate and the distribution of assets as well as set up a contingency plan for the proper execution of the intended objectives of the estate owner. A main point of estate planning is to ensure that the major portion of the estate passes to the grantor's beneficiaries. A well-constructed estate plan can achieve this by evading or reducing the involvement of probate court in the division of assets after the demise of an estate owner. Estate planning can also be use to assign a guardian or custodian to a minor or for a disabled person.
A well-constructed estate plan will consist of several documents with clear and precise terms, conditions, and provisions so the trustee/executor can perform and realize the wishes of the grantor. The estate owner can have documents drawn up that will serve to manage personal health care decisions in the event he/she is unable to make those decisions for him/herself due to a healthcare related catastrophe. Others documents can be created to administer the grantor's business, assets, or property in the event the grantor becomes incapacitated and cannot manage his/her estate.
Some of the traditional legal documents used in estate planning include:
The popular myth that estate planning is only for the affluent that own a lot assets keeps most Americans from using the benefits that estate planning offers. The truth is that estate planning can benefit most people and help them leave more to their loved ones through reduced taxes, litigation, and unnecessary expenses. Everyone has an estate, regardless of his/her capital, assets, property, or business interests.
Proper planning will ensure that your heirs will receive a greater portion of what you have to leave them and that the persons you designate to receive certain effects will actually receive them. If you do not make these decisions with an appropriate plan, the state will decide for you according to the laws of the jurisdiction where your assets are held. The state will accomplish this through that state's individual probate process with little consideration for your wishes. The probate process provides a way for the state to settle debts, pay taxes owed by the estate, and to resolve disputes within the heirs of the estate but it will charge the estate for any services it provides.
Your unexpected death could leave your family and estate in disarray and without appropriate financial management or suitable organization. Estate planning guarantees the meticulous and systematic division of your property and assets according to your expressed desires and instructions. This is crucial to protect your estate. Estate planning is a sensible and vital part of any financial plan and can save your family from expenses associated with probate court and family divisions and/or tension that may arise after your death.
A qualified attorney experienced in estate planning can assist you with any of the following legal tools to help you achieve your estate planning goals:
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