Estate Planning 101

Who needs an estate plan? In short, everyone. If you own anything, from vast real estate holdings and businesses to an antique record player owned by your grandfather, you have an estate. As it goes, you most likely would like some say in the handling of these assets in the event of your passing or incapacitation. That is what an estate plan achieves.

While it is often an uncomfortable topic, it is a necessary one to make, and not necessarily only if you are aging or have children. Often, those that are single will have their assets donated to a charitable cause or a close friend. The point is, you have the autonomy to disperse your belongings and assets when you have an estate plan in place.

Granted, when you are born, everyone has an estate plan in place, and it is prescribed by the state of Michigan. In the event that you are incapacitated, without your own plan in place, you will have decisions signed off for you by a court appointee. The court will determine how to use your assets and what decisions are to be made. This is called conservatorship.

In the event of your death, you will have your assets distributed by probate law. If you have ever seen a movie or TV show where a family is fighting over something left behind by a passed relative, this is what probate can turn into. Leaving your grieving family to fight over your home, bank accounts, and heirlooms, probate can turn ugly and will most often not result in an outcome you would have chosen.

With an intentional estate plan in place, these scenarios can be avoided. If you have a will, probate will still be in effect, as by law, assets bequeathed to others will still need to be authorized by the court. However, this will allow for assets to go where they are supposed to go, as opposed to allowing the court to hammer out the details.

Another document that is essential to have in place is a Healthcare Derivative. This is a document, often referred to as a “living will” that outlines your wishes in the event of medical incapacitation. You can grant authority to someone you trust to make medical decisions on your behalf, including how assets might be used to care for you. Many times, an aging adult may have children to help in this process. However, let’s say you live in Wyandotte or Southgate, and one of your children lives in Trenton, and another lives up in Escanaba. Your child up North has no children and has time. Your child in Trenton is a busy small business owner with 4 children. You may want to have one, the other, or both, available, should an emergency decision need to be made. This is what a Healthcare Directive can achieve,

You may think you are too young to have an estate plan in place. However, much like insurance, it is better to have it and not need it, than to need it and not have it. Want to discuss your options? Need information on estate planning? Give The Mitten Law Firm a call today. We will guide you through the process so your assets are distributed according to your wishes.