Your estate plan, even a simple one, can save your loved ones time and stress and give you peace of mind in how your affairs are handled. There are many documents that can make up an estate plan, and these vary based on individual needs. However, there are several common documents in a strong and comprehensive estate plan. A skilled Indianapolis estate planning attorney can help you decide what documents will most benefit you.
Last Will and Testament
A will is a foundational document of a basic or a comprehensive estate plan, as it enables you to distribute your assets to your heirs after your death. This is the primary function for most people’s wills, but a will also:
- Names an executor or administrator for the estate who distributes the assets and takes care of other matters during probate
- Names a guardian for any minor children you have
- Inventories the assets and debts in your estate
You can update and alter your will throughout your life to ensure it matches your most current wishes for the management and distribution of your estate.
A will prevents your estate from being distributed according to Indiana’s intestate succession laws. Intestate laws may not reflect how you wish your estate to be distributed, may cost your heirs more time and money, and allow the court to place someone in charge of your estate’s administration. A will provides you more control over your estate and the care of your loved ones.
However, a will on its own does not avoid probate court, which in itself is timely and expensive. More comprehensive planning is needed to avoid this public process.
Understanding Trusts
A trust can also inventory and distribute assets in your estate, like a will. However, a trust is a private legal entity rather than a public document. Assets held in a trust pass to the successor trustee after your death and are never under the jurisdiction of probate court. Because trust assets avoid probate court, your beneficiaries receive their assets more quickly, with fewer costs, and privately.
Your estate plan can consist of one or many trusts, depending on your needs. Trusts can be established to hold assets for minor children or grandchildren, ensuring their assets are protected for them under fiduciary duty until they are of age. Trusts can also hold assets for beneficiaries who are receiving state benefits so that they do not lose those benefits.
The trusts you establish can be revocable or irrevocable trusts. These are also called living and testamentary trusts. A revocable or living trust can be altered at any point during your lifetime, while an irrevocable or testamentary trust requires significant steps to alter.
Powers of Attorney
Your powers of attorney provide a trusted individual with specific powers if you are unable to take those actions or make those decisions yourself. If you are incapacitated or incapable due to illness, an accident, or other health concerns, you can be assured that you will be cared for. The most common powers provided in a power of attorney designation are:
- Medical Power of Attorney: Designates an individual to be in charge of your medical and healthcare-related decisions.
- Durable Power of Attorney: Someone can be placed in charge of your financial decisions, such as paying bills, selling property, managing debt, and other financial actions.
You can provide anyone you trust with these important decisions with power of attorney. This may include a friend, family member, other loved one, or professional. It is important that they are responsible and have the capabilities to handle these important choices. Powers of attorney documents expire when you die.
Advance Directive and Living Will
An advance directive can take many forms in Indiana, but it states specific wishes for your healthcare if you cannot make medical decisions for yourself. You may become incapacitated or incapable near the end of your life or due to a sudden accident. These documents provide instructions for your medical power of attorney regarding where you wish to receive healthcare, your wishes for pain management, spiritual beliefs to be followed, and other important wishes.
FAQs
Q: What Are the Five Essential Documents for Estate Planning?
A: The essential documents in an estate plan include:
- A last will and testament
- An irrevocable or revocable trust
- A living will and advanced medical directions
- Medical power of attorney
- Durable power of attorney
The exact documents in an estate plan depend on the unique needs of the individual who creates it. These documents are common because they list wishes for an individual’s assets after their death and for their care during their life, and they provide trusted persons with legal and other powers.
Q: How Do You Organize Documents for Estate Planning?
A: To organize documents for estate planning, you should:
- Create a list of and include copies of important documents and digital information, including financial information, personal information, and property, insurance, and legal records.
- Make a list of important contacts, such as your estate’s executor and your powers of attorney.
- Ensure the locations of important documents are known and accessible to specific people, such as your loved ones, your attorney, or your executor and trustee.
Q: Can I Write My Own Will in Indiana?
A: Yes, you can write your own will and have it legally valid in Indiana. However, it is important to be aware that this increases the chances of mistakes and other issues that could result in an invalidated will. A less secure will also increases the chances of a will contest and of a contest being successful. When you have an attorney help you draft or review a will, this limits these issues and helps ensure your will is valid. You can feel more confident that your wishes will be followed.
Q: What Are the Three Basic Requirements of a Valid Will?
A: The three basic requirements of a valid will in Indiana are:
- The creator of the will has testamentary capacity, including being of age and competent.
- The will is in writing and signed by the testator, or creator, of the will.
- The testator signs the will in the presence of two competent witnesses, who then also sign it.
It is recommended that these witnesses are not beneficiaries or otherwise interested in the estate, as their portion of the estate would be considered void unless there are two witnesses who are not beneficiaries.
Preserving Your Future in Indianapolis
When you need to create an effective and enforceable estate plan, contact Stange Law Firm.
