What you should know about your Estate Plan
Thu, 27 Mar 2014 15:42:44 GMT —
An estate plan is a crucial aspect to meeting the long-term needs of your family. Jessica Rooks, owner of the Rooks Law Firm, stopped by the set of Good Morning Heartland to discuss the importance of estate planning. WATCH VIDEO ABOVE to learn more.
Question: What is an estate plan?
Answer: An estate plan, simply put, is the method by which the living give their property to an individual or organization once they pass away. It may consist of a will, trust, non-probate transfers, or relying on the probate court. If you are trying to identify if you have a good estate plan, it should be customized to reflect your personal family and relationship dynamics. It will place a focus on what is important to you. And of course, a good estate plan should try to save your family time, money, and frustration once you pass away.
Question: What happens to your property if you donâ??t make an estate plan?
Answer: That is a good question, one that I do not think many people realize the answer. Even if you donâ??t make an estate plan, you already have one; itâ??s just probably a plan that you wonâ??t like and would have never designed for yourself. For individuals that have property and have not made a will, trust, or taken other estate planning measures, the state of Missouri has created your estate plan for you, and when you pass away, a series of laws will decide where your property goes. These laws are not designed to be personalized to your situation and donâ??t tend to apply well to the complex lifestyles of modern day. Essentially, you worked hard to earn what you have, and a good estate plan makes sure to maximize that hard work once youâ??re gone.
Question: Which individuals really need to make sure they have an estate plan?
Answer: I think there are two categories of people that need an estate plan the most. The first category is any individual who owns property. Property can mean a house, car, boat, farming equipment, annuities, stocks, or even your business. If youâ??re an individual that owns property, it is important to find out where your property is going to go if you pass away. People work so hard during their life to provide for their family, and so much of that work can be undermined if a proper estate plan isnâ??t put in place. The second category of individuals who highly benefit from an estate plan are families with children under the age of 18. These families may not have a lot of property, but they have another important asset that requires a different type of planning â?? their children. One major aspect of estate planning with young children is that the parents can help determine who will raise their children if they were to pass away. That decision alone can help provide stability during a time of crisis.
Question: If you want to create an estate plan what do you do?
Answer: The first step is to talk with an attorney who has a good understanding of estate planning. Before your estate plan is created, your attorney should have a good understanding of your personal assets and long-term goals for your estate, and they should explain to you the benefits and drawbacks of different planning options. For more complex estates, it may be necessary to have your financial planner, accountant, or other professionals work together to make the best comprehensive long-term plan.
Question: When is the best time to create an estate plan?
Answer: Ultimately you need to have an estate plan in place before you pass away, but there is a second time limit of which you also need to be aware. You must create your estate plan while you still have the mental capacity to do so. We often times do not have a time frame of when we are going to pass away or be rendered unable to make decisions, so I always recommend starting sooner rather than later. And for those that already have an estate plan, after any major life changes, you should always speak with your attorney to ensure your estate plan is still able to meet your needs. These major changes may include a significant improvement on your financial situation, a family change due to marriage or divorce, or perhaps a loved one has developed a disability.
It is also important to check on your estate plan if anyone in your estate plan has passed away before you. Finally, if over ten years have passed since you met with your attorney about your estate plan, it is probably a good idea to schedule an appointment to see if any changes need to be made.
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*DISCLAIMER: The choice of a lawyer is an important decision and should not be based solely on advertisements. This information is not intended to be an advertisement or solicitation. The information presented in this interview is for informational use only and is not, nor is it intended to be, legal advice. You should consult an attorney for advice regarding your individual situation. Use of this information does not create an attorney-client relationship.