Estate planning is something that everyone should consider. The unfortunate truth is that, at some time, everyone will die. Having an estate plan will ensure that you dictate – not the courts -- who will get your property with you die. Here are answers to some of the most often-asked estate planning questions.
Q. Who needs an estate plan?
A. Everyone. Eventually, we all will pass away. An estate plan allows you to direct who will get your property when you die, what they will receive, and who will be in charge of distributing the property according to your wishes. In addition, estate planning can also help limit the taxes consequences of passing property to your heirs upon your death.
Q. Isn’t estate planning only for rich people?
A. Not at all. Estate plans cover more than just financial matters. Perhaps you want someone to serve as a guardian of you children; an estate plan will allow you to designate one. Even if you have a modest savings, or only a few family heirlooms, an estate plan will allow you to decide who will receive the property you do possess. Moreover, many people use their estate plan to address issues like illness, disability, or old age.
Q. What happens if I die without an estate plan?
A. This typically means you do not have a will or any other document stating your desires. This is called dying “intestate.” In Ohio, the revised code sets forth guideline for intestate succession; in other words, the state, through the courts, does your estate planning for you. However, the state may not pass the property in the way, or to the people, you want. The state will follow the law; not your wishes.
Q. What are the rules for making a will?
A. Yes, this is why it is a good idea to contact a lawyer to draft a will. Generally, a will must be in writing, signed by the testator (the person making the will), in the presence of disinterested witnesses, who also sign the will. In addition, there are other rules concerning the mental state and capacity of the testator as well as the timing of signatures. The rules are so technical that most people need a lawyer’s help to prepare a will.
Q. Is there another kind of will?
A. Yes, a “holographic will” is one that is handwritten by the testator, however, it is unwitnessed. Because of this, holographic wills are rarely upheld in Ohio.
Q. Can my will do things in addition to saying who gets my property?
A. Absolutely. A will can name the executor of your estate. This is the person who oversees the probate process and ensures that all of your debts and taxes are paid and that your property is distributed as set forth in your will. In addition, your will can nominate a guardian if you have minor children and your spouse does not survive you.
Q. After I have made my will, am I permitted to change it?
A. Yes. You can revoke or modify your will at any time, provided you have the mental capacity to do so. In fact, most people to make changes to their wills over time as there are births and deaths in the family, people may get married or divorced, or you may want to change how your property is to be distributed.
Q. What is “probate?”
A. Probate (from a Latin word meaning “prove”) is the court process where your will is submitted and enforced by a court. It can take a long time and can be expensive, so some estate plans include steps to avoid probate, if possible. There are many tools that can be used to help avoid probate. Our law firm can advise you of them and help you implement them.
Q. What is a “trust?”
A. A trust is a legal arrangement that allows a third party, or trustee, to hold property on behalf of a beneficiary or beneficiaries. A trust allows you to maintain control of property while not being the “owner.” If properly set up, property held in a trust is not subject to the probate court and, therefore, allows the beneficiaries to gain access to your property more quickly than they might to property transferred using a will.
Q. What is a “living trust?”
A. Simply, it is a revocable trust – meaning you can change or cancel it – that keeps your assets outside the probate process, yet allows you to retain control over them during your lifetime.
Q. Is there more to an estate plan than a will or trust?
A. There can be. Life insurance can be a part of an estate plan. Life insurance is an insurance policy on someone's life and, upon the death of the individual, will pay money to the policy beneficiaries. Beneficiaries may be a spouse, children, other family members, or friends, and depending on the policy, organizations or causes. Since life insurance is based in contract, it is not a probate asset and, therefore, is unaffected by intestate succession or a will.
Q. Can my estate plan deal with health issues?
A. Yes, and in fact, many estate plans do. A “durable power of attorney” is an important aspect of an estate plan and it designates a trusted family member or friend to handle your financial affairs in the event you become so ill that you are unable to manage your own finances. Additionally, a “durable power of attorney for health care” nominates a trusted family member or friend to make health care decisions for you if you are unable to make them yourself.
Contact an attorney at Triscaro & Associates today. Please call us for all your legal needs. We offer a full range of legal services to individuals, families and businesses, including personal injury, estate planning, real estate, family law and business matters. We are dedicated to providing the highest quality legal services at a reasonable cost.