Your Will is the foundation of your estate plan. It directs how your assets should be distributed upon your death. Without a Will, your probate assets will be distributed according to the Texas Estates Code. Because your Will is the guiding document of your estate plan, you will need to consider several elements.
Could your loved ones benefit from a trust created in your Will? A carefully prepared and customized testamentary trust can protect trust assets from creditor claims and claims in divorce. Passing property through certain trusts can also have tax advantages. Under the right circumstances, a well-drafted trust can add significant value to an estate plan.
Who will you trust to carry out your wishes and care for your young children? You will need to appoint an executor to administer your estate after your death as well a trustee if you create any trusts in your Will. You should also appoint guardians for your minor or incapacitated children. Choosing trustworthy and capable people to serve as fiduciaries is one of the most important decisions of the estate planning process.
Life Insurance Policies and Retirement Accounts
What if most of the wealth you will pass to your loved ones is in a retirement account or through a life insurance policy? These assets are non-probate assets that are not controlled by your Will. However, you need to revisit the beneficiary designations of these assets to ensure that the benefits upon death are coordinated with your overall estate plan.
Revocable Trusts (a.k.a. Living Trusts)
It may be advisable to place your assets into a trust during your lifetime. However, the decision to do so turns on your personal and financial circumstances. A qualified attorney can analyze whether a revocable trust is right for you and your family, assist in creating the trust and help in the crucial work of funding the trust.
Lifetime Disability Documents
What happens if you can no longer take care of yourself or your financial affairs? You have the opportunity to plan ahead for incapacity through a variety of lifetime disability documents, including:
- Statutory Durable Power of Attorney
- Medical Power of Attorney
- Directive to Physicians and Family (sometimes referred to as a “Living Will”)
- HIPAA Authorization
- Appointment of Guardian for Minors or Incapacitated Adults
Estate Planning Resources
- Who Takes if You Don’t Have a Will?
- The Problem with Do-It-Yourself Estate Planning
- Estate and Gift Tax Planning
- Special Needs Planning
- 529 Plans – Gift & Estate Tax Implications