Time flies when you’re having fun, as the old saying goes. November marks our firm’s 10-year anniversary. We’ve helped many people with their estate planning, tackling legal problems and forming relationships with our clients that have been rewarding and long-lasting. It seems like ten years went by in the blink of an eye.
In this article, to celebrate ten years, we’ll give you ten pieces of advice for setting up a great estate plan.
10. Store Your Documents Wisely
We live in Florida, and hurricanes are all-too-common. If you have estate-planning-related documents sitting in a box that is neither water nor flame proof, that is likely not going to end well. One basement flood, and you’re in for a whole world of headaches. Store your docs on a secure server. While it’s great to keep the originals, talk to an attorney about ways to make them digital and safe.
9. Don’t DIY It
This one might seem a little self-serving, but it’s true. Do-it-yourself legal services often cause way more headaches than they prevent. Why? Because law is tricky. One wrong word and your family might get tied up in probate court for half a year. There is special language required to set up trusts, healthcare directives, and power of attorney forms, and it can be difficult. Contacting an attorney is the bets choice.
8. Avoid Funeral Prepayment Plans
Funeral prepayment plans seem sensible on the surface. You want a nice funeral that won’t run your family into the ground financially. The prepaid plan is an arrangement between your choice of funeral home and you. However, these arrangements can be unreliable, as funeral homes do occasionally go out of business. Also, many prepayment plans are not able to be relocated. Your money is better off collecting interest in a bank to be used later for the funeral, as opposed to way in advance.
7. Be Tax Savvy
Not everyone is going to get hit with an estate tax, but some people (the .01%) will. If your estate is worth over $5.49 million, you may owe an estate tax. There are ways to minimize this tax through tools such as irrevocable trusts or charitable trusts, but you can only minimize taxation legally if you know what you’re looking at paying.
6. Insurance, Insurance, Insurance
Consider life insurance. Insurance is something you don’t realize you need until it’s too late. Life insurance will benefit and protect your family for years to come, and it is a good way to provide extra financial security to your loved ones.
5. Keep It Updated
Setting up your estate plan is not automatically the end of the road. You have to make sure it is kept updated for new family members, new financial situations, and things such as that. Families change, and you want your estate plan to change with your family, if necessary.
4. Pick a Great Power of Attorney
A power of attorney is the person who makes legal, financial, and/or healthcare decisions on your behalf. Needless to say, you want to make sure that the POA is someone who is very trustworthy and conscientious. And if they turn out not to be…
3. Don’t Be Afraid to Fire Your POA
…then don’t hesitate to fire them. It might cause familial tension, but you shouldn’t hold on to the POA just because you want to be nice to them. The power of attorney needs to go to and remain with the person who is best for the job.
2. Put Your Wishes Front & Center
A good example of this is a healthcare directive. This directive will let you tell a doctor or hospital your wishes for end of life care ahead of time so that, if you’re too sick to communicate them yourself, you can still make sure what you want is honored.
1. Avoid Probate Court
Above all, your goal should be to avoid probate court. Probate court is where estates go to get divvied up, and it is a drag, financially and time-wise. A good estate plan can help you avoid probate court.
Ten years, ten tips. These are definitely not exhaustive, and we could write a 1,000-page book on everything to know about estate planning. But hey! That’s why we’re the lawyers. These ten items for your estate to-do list will be put into even better practice if you hire an estate planning attorney.