Your estate planning attorney welcomes your questions. And while he is not trying to turn you into an estate planning expert, he knows that you will feel more comfortable with your estate plan if you have your questions answered. To this end, we are providing the answers to four frequently asked questions. Please see “Estate Planning for Beginners: 9 FAQ (part one) for the answers to more questions.
1. Why do I see so much about avoiding probate?
If you’re like most people you like to save money, have unfinished business settled as soon as possible, and keep your financial affairs private. Probate is expensive (extremely expensive in some states), lengthy, and public. Anyone can see your beneficiaries, their contact names, and how much they received.
2. What is a trust?
A trust is a contract. Each trust has a trust maker, trustee, and beneficiaries. The person that creates the trust is the trustee (aka “grantor”); the trustee is the legal title holder of all trust assets and the person that carries out trust instructions; the beneficiaries are the persons who receive trust distributions. Interestingly, these three roles can be held by the same person or different people.
3. I’m not old, why do I need disability planning?
People in their 30s and 40s have a three times greater chance of becoming disabled in any one year than dying. If you are injured in a car accident, have a bad reaction to a medication, or suffer a stroke, trusted helpers need to be authorized to act on your behalf.
4. Who do I need to help me?
Your estate planning attorney will guide you through selecting trusted helpers to act under your powers of attorney, will, and revocable living trust. You need a financial power of attorney agent, medical power of attorney agent, guardians for your minor children, and trustees of your trust.
If you have further estate planning questions, read part one of our frequently asked questions and consult with a qualified estate planning attorney.