A Well Thought-Out Estate Plan Helps You & Your Family
A thoughtfully designed and well prepared estate plan is a cornerstone of peace of mind. We believe that a well thought out estate plan speaks for you not only after your death but also speaks on your behalf for you during your life.
We recognize that each client’s situation is unique, and we prepare all estate planning documents accordingly.
Clients repeatedly tell us that by having their affairs in order they have found peace of mind, and they mistakenly thought it was going to be much more difficult than it actually turned out to be.
We believe that there are 6 essential estate planning documents that everyone should have:
- A Will (which is sometimes supplemented with a Revocable Living Trust)
- A Durable Power of Attorney for Financial Affairs
- A Durable Power of Attorney for Health Care Medical Financial Affairs
- A HIPAA Release
- An Advance Directive (sometimes known as a Living Will)
- Beneficiary Designations - For Pensions, 401(k) Plans, 403(b) Plans, IRAs, Life Insurance and Annuities
Each of these documents sets out your wishes as to how and by whom you want your personal and financial affairs handled during your life if you are unable to do so, and after your death with your assets passing to the right persons, at the right time, and in the right way.
Creating a Will
If you die intestate (that is, without a Will) state law dictates who receives your property and how much.
These laws vary from state to state but Nebraska’s law of Intestate Succession when there is a surviving spouse is fairly representative:
The intestate share of the surviving spouse is:
- if there is no surviving issue or parent of the decedent, the entire intestate estate;
- if there is no surviving issue but the decedent is survived by a parent or parents, the first one hundred thousand dollars, plus one-half of the balance of the intestate estate;
- if there are surviving issue all of whom are issue of the surviving spouse also, the first one hundred thousand dollars, plus one-half of the balance of the intestate estate;
- if there are surviving issue one or more of whom are not issue of the surviving spouse, one-half of the intestate estate.
We have yet to meet a client who has said of the intestate law, “That’s perfect. Don’t change a thing.”
Beneficiaries & Distribution
If there are minor beneficiaries such as children, it is often necessary to open and maintain a court-supervised Conservatorship which will be completely distributed to the child when he or she is age 19 in Nebraska or age 18 in Iowa.
A Will provides for the distribution of certain property you own at death. Subject to state mandated spousal protections, you may generally dispose of such property in any manner you choose.
Wills can have varying degrees of complexity depending on your objectives, family situation and assets. A Will may provide for outright distribution of assets by your Personal Representative at your death.
A Will may create one or more trusts at death and these trusts are called “testamentary trusts” where assets will be held and distributed according to the terms of the trust(s). Some Wills leave assets to a Living Trust. This is called a “Pour Over Will.” Again, assets will be held and distributed according to the terms of the trust. Trusts are often used to provide continued asset management, creditor/predator protection, to assure not disqualifying a beneficiary who is or may be become eligible to receive governmental needs based benefits; e.g., Special Needs Trusts, and spendthrift Trusts to protect one or more beneficiaries from their own irresponsibility.
A living trust can help you manage your assets and protect you should you become ill, disabled, or simply want to have assistance with your financial affairs.
These trusts are usually written so that you can revoke or amend them whenever you want to. That’s why they are often referred to as “Revocable Living Trusts.”
The trustee of your "living trust" (who may be you) owns property which you have transferred to it during your lifetime. You will want to appoint a co-trustee or successor trustee who will manage the trust if you are incapacitated or choose to stop serving as trustee, and who serves after your death.
You may fund the trust (in full or in part) during your lifetime or at your death. If funded while living, the trustee manages the property as you direct for your benefit. Upon your death, a living trust operates like a Will. The trustee will follow your written directions and either distribute the trust property to your beneficiaries, or to continue to hold it and manage it for the benefit of your beneficiaries. A major advantage of a living trust is that if you should become incapacitated, court appointment of a Conservator for your benefit is unnecessary.
Benefits of Living Trusts
- Professional asset management in the event of incapacity
- Quicker distributions after death or continued stewardship of property for beneficiaries
- Greater privacy than a Will
- No probate (there may or may not be advantages that we will discuss)
- A more efficient way to transfer property at death especially assets such as a house, farm, business, etc.
- Avoiding Ancillary Probate(s) if real estate in located more than one state
- More acceptance by financial institutions as compared with Powers of Attorney