April 25, 2024
What Are The Necessary Estate Documents That Someone Would Need?
What Are The Necessary Estate Documents That Someone Would Need?
First, we have what we call Disability Documents.
1. Financial Power of Attorney – document appointing someone to make Financial Decisions.
2. Medical Power of Attorney – document appointing someone to make Medical Decisions.
3. Personal Care Plan – outlines long-term care decisions.
Then we need to figure out, what is our plan upon death?
And we are looking at 2 different documents.
1. Will – gives instructions to the Probate court.
2. Will and Trust – a Trust avoids probate, controls distribution, and gives additional protection. Protection from long-term care costs and Estate Taxes. Protection of the beneficiaries from divorce, creditors, bankruptcy.
You also don’t need a certain level of assets to do a Trust.
It’s all about, figuring what are your goals? then picking on the right tools.
Typically, the Legal documents that most people need are
1. Trust
2. Will
3. Financial Power of Attorney
4. Medical Power of Attorney
5. Personal Care Plan
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Episode Transcript
Necessary Estate Documents
What are the necessary estate docs that someone would need?
Welcome to Berry’s Bites. Please join our host, attorney and financial advisor, Chris Berry.
First, we have what we call disability documents. We have a financial power of attorney. So, that’s a document appointing someone to make financial decisions. Then we have a medical power of attorney, who’s going to make medical decisions. And then we can also have a personal care plan, which outlines long-term care decisions. So we have those three disability documents.
Then we need to figure out what is our plan upon death. And really, we’re looking at two different documents. You might have a will. A will, all it does is gives instructions to the probate court. Or you might have a will and a trust. A trust avoids probate, can control the distribution, and we can build in some additional protections, whether we’re protecting from long-term care costs, we can do that with a trust. Whether we’re protecting our beneficiaries from a divorce, we can do that with a trust. Whether we’re protecting against the state taxes, we can do that with a trust.
So, it’s not like you need a certain level of assets to do a trust. It’s all about, what are your goals, and then figure out if a trust makes the most sense. And it’s not tied to your assets. I had a client, they had $4 million, and we did a will-based estate plan. I had a client, they had $50,000 and a house and they wanted to protect that and we did a Castle Trust, an asset protection trust. So it’s really just about your goals.
Typically, the legal documents most people need, a trust, a will, financial power of attorney, medical power of attorney, maybe a personal care plan. And then also, if you own real estate, and this is something a lot of people miss, I’d say nine times out of 10, when a client comes in and they’ve done some planning on their own or elsewhere, a lot of times they miss the real estate. They haven’t deeded the property to the trust. Even the individual I sat with today, he just had a will done and there was nothing done with the real estate. So if his goal was to avoid probate and he passed away right now prior to coming into our office, his two pieces of real estate are going to end up going through probate. So it’s again, figuring out what are the goals and then picking the right tools.