We’ve just celebrated yet another Valentine’s Day. Candy and flowers are fun, but what if you want something that will last longer than a sugar rush and beautiful blooms? Is there something that will protect the people you love when you can’t? Something that helps to ensure they have the lives you want them to have even if your life takes an unexpected turn? How about a gift that shows not only love but also forethought and originality?
Wills and powers of attorney likely are not the first things that spring to mind when you think of love and romance, but creating the right estate plan (whether simple of sophisticated) is a beautiful expression of love for your spouse, your children and others in your life.
An estate plan? I’m not Bill Gates!
When you hear the phrase “estate plan” you may think, “I don’t have an estate. I’m not a billionaire.” However, under the law, your estate simply is everything you own. Your home, your car, your bank accounts, your life insurance and your retirement plan all are a part of your estate. If you don’t take the time to put the right estate plan in place, Georgia has a plan for you, which will control the way your assets (large or small) are distributed. It’s likely that this state-designed plan does not reflect what you want for your family and other loved ones.
So what will a good estate plan do for you?
Protect your family
Get the right tools in place to ensure that your family can use your assets and make necessary decisions to take care of you and themselves if you can’t. A will is an important piece of most plans, but because it only takes effect after you die, a will does nothing to help you or your family if you are alive but no longer can manage your own affairs.
Without the right planning, a family has no choice but to go to probate court to seek a guardianship and conservatorship. That means court costs, time lost and attorney’s fees. The process also leaves the family member or friend who is appointed by the court with a duty to regularly report back to court about how assets are used.
A durable power of attorney and a revocable living trust are estate-planning tools you can use to ensure that you, not the court, choose the person to step in to manage your assets and make financial decisions for you if you cannot. In some situations, a durable power of attorney will cover the situation adequately. For others, the addition of a revocable living trust provides a more powerful, flexible and comprehensive way to plan for potential incapacity.
Another part of estate planning, of course, is passing on the things that are important to you to the people who are important to you.
A properly drafted will ensures the assets you have accumulated go to the people you love. If you have minor children, a will can see that the right people step in to care for them as guardians, that their education and other needs are provided for and that they do not get control of assets until they reach an age when they can manage them.
For families who have children with special needs, the right plan will ensure assets are set aside for that child without disrupting government benefits like Social Security and Medicaid. Also, business owners should give careful thought to how the business should pass on to a spouse or the next generation.
A revocable living trust, in many ways a will replacement, can accomplish all of the above and more while avoiding the need for probate. While probate in Georgia is less difficult than in some other states, many families prefer the privacy and lack of court intervention available with a revocable living trust. It also is worth noting that a revocable living trust helps pass on our assets after death and also provides a stronger, more reliable incapacity plan than a power of attorney alone.
Talk to an estate-planning attorney today and make Valentine’s Day 2011 the year that you give the gift of protection and peace of mind to those you love.
Barid and Smith have been practicing law in Savannah for more than 14 years and are partners in the estate planning, elder law and special needs planning law firm of Smith Barid, LLC.