Many people believe that if they have a valid Will they also have an estate plan, but this is not so. While a Will outlines where the deceased individual’s assets will be distributed, it does not include various other documents and directives that are available. An estate plan can include several other documents and directives, that when read in conjunction with a valid Will, provides a more detailed plan upon the death of the creator.
First let’s look at how a basic Will is created and contents of a valid will:
Creating a Will:
Initially, for a valid Will to be created the testator must be;
- Over the age of 18
- The Will must be in writing
- The testator must have the mental competency to make decisions regarding the distribution of their assets
- The Will must be signed by the testator and witnessed (note the number of witnesses is dependent upon local laws)
- The Will does not need to be notarized or even drafted by a solicitor.
Contents of a Will
The contents of the Will are dependent upon the assets the testator has. For example, a Will can distribute personal property, such as jewelry or mementos or art. A Will can also legally distribute real property, such as homes and vehicles.
For some people a Will is enough to safely and securely distribute their assets upon their death. But for most people a Will is not a sufficient level of financial planning to secure the proper distribution of their estate. Hence the need for a formal estate plan.
What Is an Estate Plan?
An estate plan allows for the use of different and varied documents to make more specific health and financially related decisions which can be relied upon if a person becomes incapacitated or upon their death. First, let’s take a look at the type of document that can be used to plan for health and medical decisions.
While no one wants to think of themselves as being physically alive yet unable to make their own medical and health related decisions, it is possible for this situation to arise. It is also possible to plan for such an occurrence by using a document called a Living Will. A Living Will allows the preparer to make decisions about the types of medical treatment they want (or do not want) to receive in the event that they are not consciously able to make these decisions for themselves.
A living will also allows for the preparer to designate someone they love and trust to carry out these decisions in the event that they cannot make the decisions themselves. Such a person is called a Health Care Proxy. Via a Living Will the following decision can be made and documented with regard to the will-makers ongoing medical treatment (ie – use of medications, food and water intake, resuscitation directions, organ donation, use and/or continuation of mechanical breathing measures such as a ventilator). Once you have drafted a Living Will and documented your preferences, you can then name a Health Care Proxy to carry out these decisions for you.
Estate planning also allows the preparer to choose among a variety of Trusts that can be used to distribute assets using particular and specific directives which provide for additional benefits to both the testator and the beneficiary including;
- Transfer of real property
- Distribution of assets using a metered time frame
- Tax benefits
- Asset protection
- Use of Trustees
There are a variety of Trust’s available to someone who wishes to use a Trust document. As such, it is best to explain to your solicitor your intentions and seek their expert advice as to which type of Trust would best meet your needs.
Power of Attorney
The use of a power of attorney designation can also be used by the Testator in a variety of ways. There are various types of power of attorney including both revocable and irrevocable. The power of attorney designation can also be used in a variety of ways. The designation of a power of attorney can be very beneficial in protecting both the assets and the beneficiary. Though, again, because power of attorney can be put into place for a variety of needs and possible scenarios, it is best to explain to your solicitor what you want to accomplish and allow your solicitor to give you recommendations that meet your specific desires and needs.
While many people understand and prepare a Last Will and Testament, many more have never had the opportunity to plan for their estate distribution beyond the aspects of using a Will. If you are one of these people, it is highly recommended that you take the time to explore the use of other estate planning documents. These options can be explained to you by a solicitor who specialized in Estate Planning. We highly recommend that you reach out to your solicitor and assess the many available ways to use additional estate planning documents to your advantage.
If you find yourself in need of assistance with this, or any other legal issue, please contact the law offices of Owen Hodge Lawyers. At Owen Hodge, we are always happy to assist clients in understanding the full ramifications of any and all of your legal needs. Please feel free to call us at your earliest convenience to schedule a consultation at 1800 770 780.