Estate planning has many tools including wills, trusts and powers of attorney that can be used to fulfill your wishes and provide for your future care. The following is an overview of the documents your estate plan may include and issues to consider.
A properly drafted will names guardians for your children, directs the distribution of your assets, and ensures that your burial wishes will be legally effective. In Illinois, if you do not have a will, state laws will govern the distribution of your estate. Usually, laws will require distribution to immediate family. For some, this is fine, but most people prefer to specify who their beneficiaries will be and the amount of the gift each will receive. Without a will, your assets will not be distributed according to your specific wishes, such as to your friends, life partner, favorite charities, or places of worship.
A trust can help family members avoid the time-consuming, expensive and very public probate process and help you take advantage of estate tax laws. A trust also provides for the well-being of your children or dependents in detail and helps avoid disputes over the assets in your estate. Placing your assets in trust can also make the transition of ownership go much more smoothly for your heirs. Not every individual needs or should have a trust; we can help you decide whether a trust is right for you.
Special Needs Trusts
Parents of special needs children must constantly navigate multiple complex and confusing systems. Our planning team understands what it is like to be overwhelmed – we, too, are parents of special needs children. Though our children’s challenges differ, we share the common goal of preparing legally and financially for their future and any contingencies that may arise. Our mission is to relieve your stress and anxiety relating to your child’s financial future with specialized planning, encouragement and reliable follow-up and implementation. Read more about our Special Needs Estate Planning.
Power of Attorney for Health Care
The Power of Attorney for Health Care allows you to designate a person to make medical decisions for you in the event of your disability or incapacity. Note that this type of Power of Attorney is significantly different from a “living will,” as allows the person you choose a much broader array of tools and discretion to use on your behalf. Without a Power of Attorney for Health Care, a court action is often necessary to empower a person (or guardian) to act on your behalf, which could take as much as a few months to complete, and can cost several thousand dollars.
Powers of Attorney for Property
The Power of Attorney for Property allows another person to make decisions regarding your accounts, investments, and property in the event of your disability or incapacity. In the event of emergency, the person you name can then manage your financial affairs while you are unable. In most cases, a Power of Attorney can avoid a court action to appoint a person, guardian or conservator to act on your behalf.
Careful estate planning is especially important for couples in “blended families” (where either spouse has children from a previous marriage), as these couples have a combination of unique issues to address. Couples should consider how children and stepchildren will be provided for in the event of either partner’s death, fairly and appropriately. Couples also must consider how to ensure the care of children where the step parent survives the children’s natural parent, taking into account child support and educational needs. If the family has not yet blended, consider whether a prenuptial agreement is appropriate to address each spouse’s interests in conjunction with an estate plan.
Life or Domestic Partners
If you are living with your partner and children and are not legally married, your issues in estate planning are unique. Even though you share financial responsibilities and life decisions, in the event of death or serious illness, you and your partner’s wishes may not be honored without proper documentation. An estate plan and powers of attorney can help ensure that you and your partner can provide for each other and your children as you wish, and that you both have the legal right to make decisions for each other and your children in the event of illness or disability.
For additional information on estate planning, wills, trusts or power of attorney, please contact the attorneys at Clancy & Associates.