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Do I need more than a will?

Wills Attorney Austin Texas Lawyer


Do I Need More Than a Will?

Learn whether you need a trust, power of attorney, or health care directive in
addition to a will.

Most Americans don't have a will, to say nothing of a more comprehensive plan to
avoid probate or save on estate taxes. Do you need to start planning what
happens to your estate when you die? It depends on your age, health, wealth, and
innate level of caution.

We've sorted our tips into broad categories of family situation and age. But
keep in mind that age is an imprecise proxy for life expectancy, which is
affected by all sorts of other factors -- smoking, extreme sports, and driving a
motorcycle, for example. It's up to you to add or subtract a few years based on
your health and lifestyle.

You're in Your Twenties or Thirties and Single
At your age, there's not much point in putting a lot of energy into estate
planning. Unless your lifestyle is unusually risky or you have a serious
illness, you're unlikely to die for a long, long time.
If you're an uncommonly rich twenty- or thirty-something though, write a will.
(Bricks can fall on anyone.) That way you can leave your possessions to any
recipient you choose -- your boyfriend, your favorite cause, the nephew who
thinks you're cool. If you don't write a will, whatever you leave behind will
probably go to your parents.

You Can Make Your Own Will
Make your will today with maximum ease and minimum cost using Nolo's Online
Will. Just log in, answer questions about yourself and your property, and print!
Or make your will with Quicken WillMaker Plus, software that comes with dozens
of other useful documents such as Power of Attorney and Health Care Directive.

You're Paired Up, But Not Married
If you've got a life partner but no marriage certificate, a will is a must-have
document. Without a will, state law will dictate where your property goes after
your death, and your closest relatives will inherit everything. Unmarried
partners generally get nothing unless you have registered as domestic partners
or entered into a civil union (allowed only in some states), in which case
surviving partners can inherit just like surviving spouses.
Another option to make sure that your partner isn't left out in the cold after
your death is to own big-ticket items, such as houses and cars, together in
"joint tenancy" with right of survivorship. Then, when one of you dies, the
survivor will automatically own 100% of the property.

You Have Young Children
First and foremost, get yourself a will. A will allows you to leave your
property to whomever you choose and, more importantly, names a guardian to care
for your children. The guardian will take over if both you and the other parent
are unavailable. If you fail to name a guardian, a court will appoint someone,
possibly one of your parents.

Note that if you don't have a will, some of your property may go not to your
spouse, but directly to your children. The problem with the children inheriting
directly is that the surviving parent may need to get court permission to spend
or invest the money -- a waste of time and money in most families. To make an
online will right now, go to Nolo's Online Will. You simply pick a package,
complete a simple interview online, and then print out your will.

Second, think about buying life insurance to replace your earnings, just in
case. Term life insurance is relatively cheap, especially if you're young and
don't smoke. You can shop for the best bargain online, by consulting free
services that compare the rates of lots of companies.

This is the time when most people consider estate planning in earnest. Keep in
mind that your assets and what you want to do with them may change in 10 or 20
years -- be prepared to revisit and change your estate plan accordingly. First,
create a will, and then consider some of these other planning options:

Revocable Living Trusts
To save your family the cost (and hassles) of probate court proceedings after
your death, think about creating a revocable living trust. It's hardly more
trouble than writing a will, and lets everything go directly to your heirs after
your death without taking a circuitous and expensive detour through probate
court.
While you're alive, the trust has no effect, and you can revoke it or change its
terms at any time. But after your death, trust property can be transferred
quickly, according to the directions you left in the trust document.

Payable-on-Death Accounts
There are other, even easier ways to avoid probate for some types of accounts:
You can turn any bank account into a "payable-on-death" account simply by
signing a form (the bank will supply it) and naming someone to inherit whatever
funds are in the account at your death. You can do the same thing, in almost
every state, with securities and retirement accounts.

Reducing Estate Taxes
Very few people have enough property to worry about federal estate taxes; for
deaths in 2011 and 2012, only some estates worth more than $5 million are taxed.
After 2012, nobody knows what will happen to the estate tax. If you do think your estate might
owe tax, here are some ways to reduce the bill for your heirs:

Give your property away before death. One way to reduce these taxes is to give
away property before your death. After all, if you don't own it, it can't be
taxed. Gifts larger than $13,000 per year per recipient are subject to gift tax,
at the same rate as estate tax. Still, an annual gift-giving plan can reduce the
size of even a big estate, especially if you have a covey of kids and grandkids.
Gifts to your spouse (as long as he or she is a U.S. citizen), direct payment of
tuition or medical bills, and gifts to a tax-exempt organization are exempt from
gift tax.

Create a bypass trust. Another way to cut estate taxes is with trusts. Some
older couples use an AB trust to leave property to each other for life, and then
to their children. The surviving spouse can spend trust income and, in some
circumstances, principal.

Create a charitable or other trust. Charitable trusts, which involve making a
gift to a charity and getting some payments back, can also save on both estate
and income tax. There are many other complex trusts; learn about them on your
own and then have an experienced estate planning lawyer draw up the documents
you want.

You're Over Fifty or Ill
Now is the time to take concrete steps to establish an estate plan. First, the
basics: Consider a probate-avoidance living trust and, if you're concerned about
estate taxes, a tax-saving trust. (These devices are discussed just above.)
Write a will, or update an old one.
Then take a minute to think about the possibility that at some time, you might
become unable to handle day-to-day financial matters or make healthcare
decisions. If you don't do anything to prepare for this unpleasant possibility,
a judge may have to appoint someone to make these decisions for you. No one
wants a court's intervention in such personal matters, but someone must have
legal authority to act on your behalf.
You can choose that person yourself, and give him or her legal authority to act
for you, by creating documents called durable powers of attorney. You'll need
one for your financial matters and one for health care. You choose someone to
act for you (called your agent or attorney-in-fact) and spell out his or her
authority. You can even state that the document won't have any effect unless and
until you become incapacitated. Once signed and notarized, it's legally valid,
and your mind can be at ease.





Wills Attorney Austin Texas Lawyer



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