Is it the right time for my estate planning? This question seems to enter our minds not too long after becoming a responsible adult and is exacerbated as we get married, buy a home, have children, and grow older. Most people, however, do not have their estate plan set up or their estate planning is not updated. So, when is the right time for us to do our estate planning?
Although this is a quite common question, it misrepresents what exactly estate planning is by portraying it as a single event that just needs to be done once during our lives. Instead of thinking of estate planning as a single event, we should look at it like a process that changes as we change. An estate plan that contains all our important wishes and instructions can provide valuable piece of mind. As we change and our priorities change, so should our estate planning.
One fundamental part of estate planning includes naming a person or persons to act on your own behalf, so that those you love will have clear authority and instructions as to your wishes. Without these instructions and appointments, family members generally would need to obtain a court order before they may act on your behalf. You also may appoint a trusted person to be a guardian for your minor children. Not only do these appointments and instructions save time and money, it allows you, rather than some court, to name the person you trust the most to make those critical decisions.
Estate planning also allows you to name whatever beneficiaries you wish in whatever way you think is best. You can even leave assets for your beneficiaries in ways that can be protected from their creditors, divorcing spouses, and other liabilities they might have. Without these instructions and protections, your beneficiaries will be defined by law and those beneficiaries would likely need court approval through probate before they are able to inherit anything and what they end up inheriting may be taken away from them by creditors.
Often our younger clients are concerned about mortgage payments, guardian for minor children, and asset protection from working activity. So, we take time to understand these concerns and generate a plan that specifically plans for these important issues. Our older clients often prefer different things such as the surety that their intentions will be followed and maybe some added protections against things like Medicaid liens.
As you review your estate plan regularly, you can ensure that your own estate planning keeps up with your own changing priorities. Often attorneys who do not specialize in estate planning or Medicaid planning are not able to offer you some of the valuable legal options available for our estate planning. For example, if you plan ahead, you can transfer assets to a non-revocable trust to hold those assets so that if you happen to need long-term care, the assets of this non-revocable trust can be set aside so that Medicaid does not count them when determining whether or not you are eligible for Medicaid to help pay for long-term care costs. There are also ways to set aside your assets so that those assets can be separated from you in the event of a claim against you personally by a creditor.
Getting the opinion of an estate planning specialist or Medicaid specialist can provide valuable information, protections, and assistance. Since our lives are full of changes and sometimes even the laws we count on change, we should remember to review and update our estate planning regularly.