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Types Of Wills In Estate Planning

The will and estate planning are interrelated with each other. Because the type of estate trust completely depends on the formulation of the will. While planning any estate before the estate attorney, the primary step is to compose the will and relocate the monetary distribution in that will. The process of this type of asset planning requires the person who wants to plan his estate, his descendant, the estate-planning attorney and most crucial his will.

In the primary stage of the legal planning, the estate-planning attorney communicates and confirms the whole background of that person. While analyzing his character, the attorney understands the monitory condition of that person, his monitory assets, real estate and private estate. Also the attorney make clear the clients aspirations about his family members and also gets information about the necessities of client’s adorning family members after the death of the client.

Also one of the vital parts of the will and estate planning, the attorney elucidate from the client about his goals and future aspirations about the estate and also reveals about the health related desires from the client.

Before making the will and estate trust, the attorney will display and describe various alternatives, which is obtainable to the client. He assures the client that such asset protection planning will work thoroughly with you and it is a perfect match for future expectations of the client towards his family members after his death. The suggested estate protection by the attorney is completely in reference to terms and conditions in the will and in accordance with the desires of the clients about his wealth. So while making the will and estate plan, the attorney mostly gives emphasis to the monitorial security of the client’s family after his death, secondly more weight age on the equal distribution of the wealth as it is mentioned by the person in the will and thirdly physical requirements of client and his family members.

While making the will and estate plan, the attorney mentions some rules, regulation, and strategy to save the estate. He suggests some precautionary measures to put aside the family members from financial problems like taxes, family budget and other household expenditure. After giving suggestions, guidelines and confirming all the requirements of the client for will and estate, finally he will carry out all essential living trusts documents, papers of will, documents of powers of attorney and testamentary trusts. Also in some cases, the attorney himself consults with expert accountant or tax consultant to secure the client from allegation of negative tax.

A Will is a legal document containing your written instructions for how your property/assets will be distributed and how your dependents will be cared for in your absence. Your assets may consist of bank accounts, brokerage funds, vehicles, real estate, items of sentimental value, and other personal property.

In a Will-based estate plan, your Last Will and Testament will cover four important points:

  1. Who will serve as your Personal Representative/Executor;
  2. What powers your Personal Representative/Executor will have;
  3. Who will be your beneficiaries (those who will inherit your property); and
  4. How your property will be transferred to your beneficiaries.

What Are the Legal Requirements?

A Will is valid if:

  • the Will maker is eighteen years old;
  • the Will is in writing;
  • the Will is signed by the Will-maker; and
  • the Will is witnessed and signed by at least two people in the presence of the Will maker.

What Are the Advantages and Disadvantages of Wills?

Potential Advantages

  • A Will is good for individuals and families who do not have assets that would have to go through the court process called probate, or who are not concerned with avoiding probate.
  • A Will is traditionally less expensive to prepare than a trust-based estate plan.
  • A Will allows you to appoint a guardian to care for your minor children until they become adults.

Potential Disadvantages

  • A Will may not provide sufficient tax planning leaving your estate and/or beneficiaries to pay hefty federal, and state estate taxes.
  • A Will may not sufficiently protect your assets from creditors.
  • A Will must go through probate, which can take anywhere from a few months to a couple of years; very expensive; and complex. Probate also lacks privacy, meaning your estate plan will become part of the public court records that anyone can read, including your Last Will and Testament, a list of your beneficiaries and assets, and a breakdown of who’s getting what and how and when they get it.
  • A Will alone does not make any provisions if you should become incapacitated.
  • A Will generally addresses the distribution of the bulk of your assets, however, there are some assets that are not covered by the instructions in your Will such as community property, life insurance payouts, retirement assets, investment accounts that are designated as “transfer on death,” and assets owned jointly by two or more people where the survivor automatically gains ownership (joint tenants with right of survivorship).

How Can I Change or Revoke My Will?

You can always revoke or change your Will before you die. You can change your Will by executing a new Will or by an addition called a “Codicil.” Written changes, such as additions, deletions, comments or marks, on the Will itself may invalidate the Will. Therefore, once signed, a Will should not be altered in any way without the assistance of an estate planning attorney.

What Should I Consider When Making A Will?

  • Who should receive my property? In what proportions? If there are children, at what age(s)? If a person you wish to name to receive a share of your estate dies before you, who should receive that share?
  • Who should be named as guardian of my minor children? If you have minor children you should also consider a Child Protection Plan which will name temporary and permanent guardians for your children.
  • Should a Trust be created in my Will for my spouse, children or others?
  • Should insurance proceeds be payable to a Trustee named in my Will? Spouse? Children?
  • Who should I name as Personal Representative? Successor Personal Representative?
  • Do I expect to inherit property from a parent or others, thereby increasing the size of my estate and creating the need for more careful planning?
  • Can I lessened or avoid estate taxes?

Types of Wills & How to Choose the Right One

1. Living Will

Despite the similarity in name, a Living Will actually does a lot more than a traditional Last Will and Testament can. Also called an Advance Healthcare Directive, a Living Will is good for end-of-life planning and to make your wishes known regarding medical care you may want in the future.  In the event you become incapacitated for any reason and you can’t let doctors or loved ones know what you want, a Living Will can speak for you. The benefit of a Living Will is it greatly eases the burden on loved ones if tough decisions need to be made on your behalf. Note that Living Wills become immediately ineffective once you pass away. Make sure your Living Will is valid in and specific to your state, as requirements can vary.

2. Testamentary Trust Will

Testamentary Trust Wills are sometimes referred to as Will Trusts or as Trust Under Wills. They are written inside a Will and can be used to direct asset distribution after your passing. This type of Trust differs from other Trusts in that it isn’t actually formed until after your death. Testamentary Trust Wills can be a good option if you need to set up long-term care for Beneficiaries. Whereas most Trusts allow you to avoid it, Testamentary Trust Wills will go through probate, which can be a significant disadvantage.

3. Pour-Over Will

Pour-Over Wills work in conjunction with Revocable Living Trusts. They are designed to offer more privacy than a regular Last Will and Testament and work by “pouring over” any assets that don’t directly go to a Beneficiary into your Trust after you pass away. Pour-Over Wills are useful if you haven’t put everything into your Trust. Property must go through probate before it ends up in your Trust, which can take time and money and cause stress on your loved ones.

4. Simple Will

Simple Wills, much like the name suggests, are simple in that they do not contain a lot of clauses. However, just because they’re simplistic in nature doesn’t mean they can’t be effective. You can do much of your basic planning in a Simple Will, including designating a guardian for minors and appointing an Executor. Simple Wills may not be the best option for very complicated or large estates.

5. Joint Will

Joint Wills are a Will within one document for two people. They can be used in cases where spouses want to initially make each other Beneficiaries after one passes, and then establish final Beneficiaries being a child or children once both partners are gone. It’s important to note that Joint Wills automatically become irrevocable upon the first spouse’s death.

6. Deathbed Will

Deathbed Wills are not desirable for several reasons. The biggest one being they are not as effective as other types of Wills. Made on a deathbed, and most of the time under dire circumstances, there are often questions about mental stability and how comprehensive a Deathbed Will is. While any Will is better than none at all, Deathbed Wills are more than likely to create problems for your loved ones after you pass.

7. Online Will

Relatively speaking, Online Wills are a fairly new concept in the world of Estate Planning. It’s true that there are very trustworthy, authoritative sources out there to help you create an effective and adequate Online Will. But you need to be careful about which DIY online company you use to create your Will or any other Estate Planning documents.  Not all Online Will companies are the same. It’s an absolute must that you read online reviews. And most importantly, be sure that whichever company you go with has state-specific documents and forms that are created, drawn up and reviewed by actual lawyers and Estate Planning experts.

8. Holographic Will

While not all that common, Holographic Wills do actually still occasionally exist. These are handwritten Wills and are typically the result of extreme, unexpected circumstances such as war or another life-threatening situation. Holographic Wills are not recognized as valid in every state.

9. Nuncupative Will

Nuncupative Wills are a verbal explanation that expresses final wishes. Like Holographic Wills, Nuncupative Wills are not recognized in every state. Additionally, some states have strict stipulations on what would qualify as a valid Nuncupative Will. For example, a state may recognize them, but only if they’re written down after being spoken.

What Exactly Does An Estate Planning Attorney Do?

When deciding whether or not to hire an estate planning attorney, it is important to know exactly what they do and what services they have to offer. These proceedings are undertaken as a means of legally and formally preparing for future life and after-life. This can include protection of assets, health, power of attorney and much, much more. Estate lawyers and their firms work with respect to your post-life planning, while keeping you involved and informed along the way. There are several important decisions to make regarding where all of these items will go.

These professionals know the ins and outs of the court system so that all paperwork is fulfilled completely and on time. There is a formal process for carrying this legal documentation through the court system, which experienced estate attorneys will fully understand and can simplify into terms their clients can appreciate.

An experienced lawyer knows and understands all that is required so that your assets are completely protected in the case of illness or even death. Hiring an estate planning attorney that has completed cases like yours before can also speed-up the process and reduce the learning curve. Nobody wishes to spend months getting their information together should there be a serious accident in the future.

The complexity of most legal documentation is why ninety-five percent of individuals hire estate lawyers for their paperwork. Most do not wish to face the possibility of losing assets, including that of money and belongings, due to miscommunication or lack of knowledge of court procedures. All of these items are specific to each specialist, due to the work it took to acquire the knowledge. Speak to several professionals prior to hiring the one you and your family feels best suits your needs.

What Types Of Situations Do These Professionals Handle?

The types of cases that these particular legal professionals take on is completely dependent on the firm, their availability and their willingness to take on a particular planning situation. Working on the fine details of a life and after-life planning day in and day out can easily and quickly become a full time job. Therefore, it is often necessary for most of us to hand-off the responsibility to someone who can put their complete effort into it.

It’s important to note that these proceedings are also an ever-changing legal process. What was legal and protective one year may have changed due to federal or state regulations the year after. To fulfill all paperwork and legal notations required can take anywhere from a few short days or weeks before everything is complete. Be patient and understand that good legal work does take time and proper filings.

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