I already have a will. Do I need an estate plan?
Everyone needs to have an estate plan. Why? Because a simple will tells people what you want to do with your assets when you die.
It simply states what property you have and who gets what. Most people do not even think about the important decisions they need to document while they are still alive. Since people are living longer these days, it is extremely likely that they may spend a portion of their later years in frail health.
A living will is different from a regular will in that it describes your wishes with regard to what kind of care you wish to receive later in life or when you become seriously ill. We probably all agree that the most important things in your life are your health, the well-being of your family and their financial security.
This requires you to create a specialized, individual estate plan that accomplishes your estate planning goals. If you do not have such an individualized plan, you are relying on the government to administer your estate and they will decide how your assets are to be divided. This is a dangerous path as it could also result in an estate tax obligation that is far in excess of what you would pay had you properly structured your estate.
To most people, the goal of a will is simple: distribute all property more or less evenly among the heirs. This is most likely the surviving spouse and the couple’s children. If you’re approaching middle age and have accumulated a significant amount of assets such as equity in your home, a second home, multiple mutual fund accounts, etc. then you may want to consider protecting those assets from estate taxes.
That is when you may want to consider a living trust. If you do choose a simple will, it is important that you name an administrator, or executor/executrix to handle the administration of the distribution of your assets. If any minor children are named, then it is important to also name a Guardian for the minor children and a Trustee to handle their assets. As you can see, having a family can mean that just drafting a simple will may not be enough.
You should think about whether more estate documents might be necessary for your situation. Over the years, our law firm has assisted both domestic and foreign clients with all aspects of estate planning. We walk you through the process in a straight-forward manner and suggest the necessary estate tools required for your unique situation.
If you own assets like bank accounts that include multiple family members or that involve family-owned companies in more than one country, then a more comprehensive strategy such as a living trust is the answer. We will talk about that later. But before we discuss living trusts, let us make sure you are familiar with what is known as a Health Care Proxy & a Living Will.
What is the difference between a Health Care Proxy & a Living will? Do I need both?
This plan should also include documents that indicate in detail how much care you want to receive, or not receive when you become gravely ill and unable to make decisions for yourself. This is known as a living will.
Typically, the types of treatments you want to list here deal with whether you wish to be resuscitated, fed through a feeding tube, or kept breathing artificially on a respirator when in a very serious medical condition.
No one will argue that these are difficult decisions to make, and no one wants to talk about death or the thought of leaving loved ones behind. Once you have written down all the things you do or do not want regarding medical care if you do become physically or mentally incapacitated, you are ready for the next step. Who will make these decisions for you? The document that goes hand in hand with a living will is a Health Care Proxy.
In this document, a trusted friend or family member is appointed by you. This person speaks for you when you can no longer make decisions for yourself. Together, these documents are referred to as an Advanced Directive. Advances in medicine now make it possible to keep seriously ill people alive who years ago, might otherwise have died. Many doctors are pressured by families to “do everything possible to keep them alive”.
They are also afraid of being sued if they do not do everything in their power to keep a patient from dying. Unfortunately, some patients have little prognosis of a full recovery and are left breathing on ventilators, sometimes brain dead, for months or years at a time.
Many people view this medical effort to keep people alive at “all costs” inhumane, yet they fail to document their wishes not to be kept alive by artificial means.
Such intentions are best discussed with family and detailed in the form of an Advanced Directive which is part of a Living Will. Do you really want the medical community or worse, the government dictating how your end-of life decisions will be made? Hiring an experienced attorney like UTFPA will enable you to draft the proper documents for this aspect of estate planning.