2021 Estate Planning Checklist
2021 is underway, and the focus of our lives is shifting slowly from the pandemic. However, over the past year, many people have realized the importance of estate planning. It is never too early for an adult to begin thinking about estate planning, and the following is a brief checklist of estate planning considerations for 2021. For information regarding your specific situation, please contact our Washington and California estate planning law firm directly.
Know Your Assets
First, it is important to take stock of your property that would be at issue if you passed away. This can include real property, personal property, financial accounts, and more. Knowing what you might leave behind is an important step to planning for its distribution. In addition, stay aware of your debts and who might have an obligation to pay them.
Know Your Beneficiaries
You should also identify the parties you want to receive your property and assets. Both Washington and California have spousal inheritance laws that automatically leave part of your community property – and even separate property – to your surviving spouse. However, you might have children from previous relationships, other close individuals, or even charitable organizations that you might want to receive property
Learn About Estate Planning Tools
Most people associate estate planning with a last will and testament. This is the foundation of many estate plans, though it is not – by far – the only estate planning tool you might need. The components of your comprehensive estate plan will depend on your circumstances, and they might include:
- Living trusts
- Power of attorney
- Healthcare agent
- Non-revocable trusts
Your trusted estate planning attorney can determine which tools are right for your circumstances and goals.
Choose Your Executor and Successor Trustee
Part of your will is designating someone to act as the executor (or personal representative) of your estate. This should always be an individual who you trust and who is capable of having your best interests in mind. If you have a living trust, you will serve as the trustee while you are alive and capable. Should you become incapacitated or pass away, your designated successor trustee will take over the management of the trust in accordance with your instructions in the trust document.
Executors and trustees have a fiduciary duty to beneficiaries, which is the highest duty in the United States legal system. This involves acting without bias or self-interest and managing property in a prudent and reasonable manner. Sometimes, there is an obvious choice for your executor or trustee, but in other situations, you might consider hiring a professional to take on this role. This might be a good idea if you have a particularly complex estate.
Think About Your Care, Affairs, and End of Life
Much of estate planning is focused on what happens after you pass away. However, you want to make sure you have a plan in the event you become unable to care for yourself or make decisions. This can involve:
- Long-term care insurance – Many people take out policies that will cover the costs of assisted living facilities or nursing homes. While this might seem like a significant investment, it can preserve much of your estate if you need long-term care.
- Medicaid trust – Some people form complex trusts that help protect their estate while still ensuring they are eligible for benefits to cover their long-term care expenses.
- Power of attorney – This is a document that designates someone to handle your financial and legal affairs should you become incapacitated. Without this document, the court might need to appoint a guardian, which can be a contentious and lengthy process.
- Advanced Health Care Directive – This is a complex document that appoints someone to make healthcare and personal decisions for you, as well as sets out your wishes for end-of-life care.
Life Insurance Policies and Beneficiary Accounts
When you pass away, you will likely leave your loved ones facing certain debts, expenses, and other losses. It is important to have a life insurance policy that will cover those expenses and possibly more. In addition, all of your financial accounts should have beneficiaries listed, so the funds transfer to the intended individuals without issue.
Consider How You Can Avoid Probate
One of the primary goals of estate planning is to help people pass their assets on while avoiding probate. Probate is the legal process through which an estate is administered, and it can cost your estate thousands of dollars in fees and tie-up assets for months or even years. For this reason, it’s a good idea to pass as many assets as possible outside of probate. Some of the ways that you can achieve this include:
- Putting assets into a living trust and naming your beneficiaries
- Joint ownership of assets such as real estate or vehicles
- Beneficiary designations on bank, investment, and retirement accounts
Since every estate is different, there is no one-size-fits-all solution to avoiding probate, making it advisable to work with an experienced lawyer when it comes to establishing a comprehensive estate plan. In addition, you should have regular estate plan reviews with your lawyer to ensure that your estate plan still reflects your wishes and identifies all of your assets. Some of the life events that should trigger an estate plan review include marriage, divorce, re-marriage, the birth of children, the accumulation of significant assets, the liquidation of assets, and the marriage of a child.
Call Us Today to Schedule a Consultation with an Experienced Estate Planning Lawyer
A comprehensive estate plan is an important part of protecting your wealth now and into the future. Whether you are just starting out or have an established estate plan that is in need of a checkup, John M. McWilliams is here to help. Mr. McWilliams works with clients in Washington State and California and has offices in Black Diamond, Bellevue, and Irvine.
To schedule a consultation with Mr. McWilliams, call our office today at (360) 886-2868 (Black Diamond), (425) 492-0066 (Bellevue), or (714) 465-8008 (Irvine). You can also send us an email through our online contact form.
31615 Third Ave.,
P.O. Box 100 Black Diamond , WA 98010, US
14205 SE 36th St.,
Suite 100 Bellevue , WA 98006, US
19200 Von Karman Ave.,
Suite 400 Irvine , CA 92612, US
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