Necessary Parties Involved In Creating An Estate Plan

Necessary Parties Involved In Creating An Estate Plan

Necessary Parties Involved In Creating An Estate Plan

In regards to a will, you’ve got the person making the will, who is the testator, and the beneficiaries, who are going to benefit from that will. Oftentimes, we’ll include contingent trust provisions in the will, so there might be trustees involved. If there are minor children, we usually designate guardians. In incapacity planning, there are powers of attorney to handle financial and medical decisions. Sometimes, someone may foresee the need for adult guardianship. In that case, there can be designations of guardianship made as well.

Do Most People Plan For Mental Incapacity When Setting Up Their Estate Plan?

Mental incapacity is part of the conversation we have with clients. We typically would prepare powers of attorney for that scenario. The court can certainly authorize a guardianship over someone if they’re incapacitated, but the less restrictive alternative is having powers of attorney. This simply gives someone the authority to handle things on behalf of the incapacitated person, whether it be handling their finances or making medical decisions. We can also plan for future incapacity by making guardianship declarations, mental health declarations, and supported decision-making agreements.  As part of our conversation and work with clients, it is important that we try to address their concerns for any potential future mental incapacity of any level.

Basic Items In An Estate Plan

In a basic estate plan, there would be a will, which would be a designation of beneficiaries who are going to receive property from the decedent. It could also have a contingent trust or a “testamentary trust” built into the will for minors or other family members to whom they don’t want to make outright gifts. It could include guardian designations and things like funeral arrangements or other wishes. The will would also appoint an executor to administer the estate, paying creditors, collecting debts owed to the estate, and making disbursements to the beneficiaries.

Also necessary would be a durable power of attorney, which would designate an agent to handle financial transactions on behalf of the person making the estate plan. There would also be a medical power of attorney to designate someone to make medical decisions if the person making the estate plan should become physically or mentally unable to make those decisions for themselves.

We also prepare a HIPAA release naming the people in the medical power of attorney to authorize them to receive medical information. Many times, people want a living will or advanced directives designating what they want if they’re incapacitated and they have an injury or illness that would render them unable to make the end of life decisions.

How Often And Why Should We Give Our Estate Plan A Check-Up?

I recommend to my clients that anytime there’s a change in their lives, like a birth or adoption, a death, or a divorce, they take a look at their estate planning. Also, it’s worth reviewing every five years, even if nothing has changed. Take a look at your documents to be sure that everything is accounted for, especially the life changes that have taken place since the last update.

For more information on Parties & Components In An Estate Plan, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (830) 625-9300 today.