Estate Planning Basics

Posted in Probate & Estates on January 31, 2022

Estate planning is a critical activity that every person should engage in. This process involves identifying your assets and detailing how you want your property to be handled after you pass away or if you are suddenly incapacitated.

Without a proper estate plan in place, the handling of property can become complex and stressful for family members—and creating an estate plan can help streamline the process. Before you begin to craft your estate plan, it is important to understand what is involved in this complex process and the issues that may arise along the way.

Who Needs an Estate Plan?

Everyone needs an estate plan, even if you believe that you are not old enough or do not make enough money. These requirements are not necessary to establish an estate plan. If you are over the age of 18, you should begin thinking about creating one; you do not want your family to make tough decisions in the event of the unexpected.

Important Components of an Estate Plan

An estate plan is made up of several important documents, each of which perform different functions. As a whole, these components create a powerful and comprehensive plan for the division of your assets and your final wishes.

  • Will: The will is a legal document that details your final wishes for the division of your property and other assets. These may include real estate, vehicles, personal possessions, life insurance policies, business ownership, and retirement plans. A will contest lawyer in Texas can help you with changing the document based on certain circumstances. 
  • Trust: A trust is a financial agreement between a trustor, trustee, and beneficiary. If you have a trust, you give a trustee the power to manage assets and property on behalf of a beneficiary. 
  • Guardianship: If you have children or dependents under your care, you will need to create a guardianship document. This will detail who you want to care for these dependents in the event of your death or if you are unable to care for them.
  • Power of Attorney: There are two types of power of attorney documents involved in an estate plan. The financial power of attorney gives someone else the power to handle your financial matters. The durable power of attorney gives power to someone to handle your non-medical affairs, even if you become incapacitated.
  • Healthcare Documents: An estate plan will typically include an advance healthcare directive (AHCD), also known as a medical power of attorney. This document details the medical actions that should occur if you are unable to make decisions. Additionally, you will likely provide a Health Insurance Portability and Accountability Act (HIPAA) authorization so that a third party can access your medical records.

Should You Work with an Attorney for Your Estate Plan?

If you are creating an estate plan, it is important to seek the help of an attorney. Navigating this process can be complex and you want to protect your and your family’s best interests while creating these documents. 

An estate planning lawyer can evaluate your assets and help you create a plan that meets your needs and Texas’s legal requirements. Contact a Texas estate & trust litigation attorney as soon as possible to discuss your assets and begin preparing the necessary documents.