Everyone should have an estate plan.
It is not just for the old or the wealthy. To help you understand what’s involved in an estate plan and to aid you in getting started, we’ve provided an easy-to-follow Ultimate Estate Planning Guide.
What's in this Estate Planning Guide?
What is Estate Planning?
Estate Planning is the method to establish the plan that will establish what will happen to your estate once you die. It can include a number of fields of law including wills & trusts, insurance, healthcare, taxation, employee benefits and future interests.
In it, you will also make important personal decisions such as selecting a guardian for children under the age of 18 in case you pass away before they become of legal age, and the selection of who you want to be in charge of your financial and medical decisions in case you are unable to. Having an estate plan can help you to avoid the lengthy and costly process of probate as well.
Using our Ultimate Estate Planning Guide, along with the aid of an Estate Planning Attorney, you can set in place the foundations of a solid estate plan.
The Ultimate Estate Planning Guide
A Will, sometimes called a Last Will & Testament, is the legal document that declares who will receive your property and assets and who will care for any minor children. It will also indicate who will receive your assets and take over these duties if the person you designated (your beneficiary) passes away before you do.
After you pass away, your will goes into what is called “probate.” This is where the court proves that your will is legitimate.
Once that is done, the person you designated as your executor/personal representative/administrator in your will can begin to do their duties of collecting the documents and personal property of your estate and distributing it according to your wishes. Reported to the court, your will becomes part of the public record.
Wills in Virginia
In Virginia, after funeral costs, debts and any other expenses are paid from your estate, your remaining estate will pass to your spouse, unless you have children from a previous relationship. If this is the case, those children will receive two-thirds of your estate. Your spouse will receive the remaining one-third.
Read more about who inherits here.
Guardian for Minor
Under Virginia Law, you can appoint a guardian for minor children who will gain custody after both of the child’s biological parents have died. A court can overrule your selected guardian, but gives great weight to your preference of a guardian.
If you don't have a will...
If you die without having a will, your estate will be subject to what are called “intestate” laws, which differ from state to state. In Virginia, decisions regarding your assets will be made either by state laws or by the Circuit Court. For example, the Commonwealth of Virginia has full power to appoint a guardian for any children under the age of 18. You can avoid this if you transfer all of your assets into a trust, and meet other requirements that your estate planning attorney will explain.
The cost for creating your will varies by the amount of complexity.
A Trust is a legal document that, like a will, can document your last wishes. Unlike a will though, it doesn’t go through the probate process. It can function similarly to a will, but it can also be used before your death.
To create a trust, you must put your property into the name of a “trustee” who will manage it on your behalf either while you are living and/or after you die. This person will have full ownership of the trust and control of the property listed, according to the trust agreement.
Revocable vs. Irrevocable Trust
There are two types of trusts to be aware of: a revocable trust and an irrevocable trust. A revocable trust can be changed by you at any time, while an irrevocable trust is “set in stone” and cannot be changed.
Successors & Beneficiaries
You can designate yourself as the initial trustee, and appoint a successor who will manage and distribute your trust upon your death. You can also name the beneficiaries who will claim your assets following your death, as you can with a will.
A trust is private and is not recorded in public records.
Your estate planning attorney can help you determine directives for your personal care in the event that you may become incapacitated and unable to make decisions on your own. Your estate planning attorney may also advise you to establish a Living Will.
In a Living Will, also known as an Advance Medical Directive, you can pre-determine your medical care in the case that you are unable to make medical decisions on your own in the case you are incapacitated, incompetent or unable to communicate. It defines the type of medical treatment you want in that circumstance. For example, you may not want to be put on life support and can state that in your Living Will.
You will also designate the person, or proxy, who will carry out your medical wishes on your behalf.
Durable Power of Attorney
You need to assign several types of Powers of Attorney in your Ultimate Estate Planning Guide.
- Medical or Healthcare Power of Attorney. This is the person you choose to make health and medical decisions on your behalf if you cannot.
- Financial Power of Attorney. This is the person you choose who will pay your bills and make financial decisions on your behalf if you cannot.
- Situational Power of Attorney. This is the person you designate act on your behalf in special circumstances, such as when you are assigned military service or if you get sick while traveling.
Keep on Top of Changes
Setting your Ultimate Estate Planning Guide into place once isn’t enough.
You must regularly update your estate planning documents as circumstances in your life change.
For example, a new grandchild is born and you want to name the child as one of your beneficiaries; you go through a divorce or marriage; or a death occurs, like with one of your beneficiaries or one of the people you’ve chosen for a Power of Attorney. Your documents should also be updated when you or someone else is temporarily or permanently incapacitated.
We recommend that you set a schedule to regularly review your Ultimate Estate Planning Guide to make sure it stays current. You may want to look at it once a year, for example.
Some people put off creating an Estate Plan because they think, “I’m still young. I won’t die soon.” But death can happen at any time, whether you are young or old.
It is best to have a plan for your future in place. And it’s not too late to get started.
Learn more about the steps to creating an Ultimate Estate Planning Guide.
The Ultimate Estate Planning Guide Checklist
In review, here are the basic elements of an Ultimate Estate Planning Guide:
Choose who receives your assets and when
Engage an Estate Planning Attorney
Create your Last Will & Testament
Create Your Living Trust
Create Your Living Will
Establish your Power of Attorney
Read more about Estate Planning Checklists.
Contact Your Local Estate Planning Attorney
We carefully explain your options and walk you through the process, attending to every detail. We can help you draw up your will, trust, advanced directives, powers of attorney, and assist with all areas of estate planning. In summary, we can help you create Your Ultimate Estate Planning Guide.
Please contact our office to set your consultation for estate planning services.