On Monday 2/23/15 I had the pleasure once again of being a guest of Dr. James Gore on his radio show New Urban Unlimited on 1150AM KKNW in the Seattle area. I will be on the show which airs M-F at 6am, the last Monday of every month in 2015. You can listen to the most recent show on the link above. During this show Mr. Gore and I have a candid conversation about the importance of putting together an estate plan.
Here are the highlights from our conversation.
What is Estate Planning and What Does it Generally Consist Of?
An estate plan can come in many forms but the most common parts of an estate plan consists of having a will, a trust, health care directive and a power of attorney should you become incapacitated.
Why Should People Think About Planning Their Estate Now?
An estate plan is a plan for your future an the unknown. If you are not proactive about letting your intention known with regards to your estate, parenting decisions, or health care decisions the state will make those decisions for and you will not have a say in these important decisions.
What is a Will?
A will is a legal document that lets you tell the world who should receive which of your assets after your death. It also allows you to name guardians for any dependent children. Without a will, the courts decide what happens to your assets and who is responsible for your kids. The will allows you to name an executor to handle your estate and also allows you to name who can make medical decisions on your behalf.
What is a Trust
A trust is a fiduciary arrangement that allows a third party, or trustee, to hold assets on behalf of a beneficiary or beneficiaries. Trusts can be arranged in many ways and can specify exactly how and when the assets pass to the beneficiaries. Since trusts usually avoid probate, your beneficiaries may gain access to these assets more quickly than they might to assets that are transferred using a will. Additionally, if it is an irrevocable trust, it may not be considered part of the taxable estate, so fewer taxes may be due upon your death. Assets in a trust may also be able to pass outside of probate, saving time, court fees, and potentially reducing estate taxes as well.
What is the Difference Between a Revocable vs. Irrevocable Trust?
A revocable trust is a trust that you can amend at a later date and even change beneficiaries of your trust. This type of trust is beneficial if you expect your circumstances to change in the future. A irrevocable trust cannot be reversed and you will give up control of this type of trust. With that said you can name yourself, a business or a family member the executor of your trust. An irrevocable trust may be beneficial if you are trying to avoid judgments from creditors who cannot attach or garnish assets that you don’t own or have control over.
What is a Health Care Directive?
A health care directive is a document or a clause in your will in which you can indicate who you would like to make your health care decisions or whether you would like life support to remain intact should you become incapacitated.
What is Probate and How Do I Avoid It?
Probate is the legal process of settling the estate of someone who has passed away. In practice, this means that a person is appointed by the court (a “personal representative”) to step into the decedent’s shoes and wind up his or her affairs. In certain circumstances a probate case must be opened in court so that a personal representative can be appointed. In small estates where there is no real estate and under $100,000 in assets, a small estate affidavit may be filed within 40 days of death.
If you have additional questions regarding you estate plan in Washington State, give Symmes Law Group a call at 206-682-7975 to learn about your options.