Earlier last year, I wrote articles about when it might be appropriate to update an existing estate plan and the consequences of dying without any estate plan at all. However, there is an important related question that I have not touched on yet, and that is: what should be done to determine if it is the right time and circumstance to begin estate planning?
A logical starting point is to take stock of your assets so that you can decide how you might want to transfer them when you die. Next, consider who you would choose as your beneficiaries and who you would choose as your agents to administer your estate plan (i.e. “executor”, “personal representative”, “trustee”, etc. – all technically have different meanings but are similar in nature). Focusing on these first few initial items can make the entire process easier going forward.
In terms of analyzing your assets, some may not require instruction in a will or trust, as they might be owned jointly with others who automatically become the owners by virtue of a right of survivorship (e.g. real property owned with a spouse, joint accounts, etc.) or have a beneficiary designation that you can use to automatically transfer ownership when you die (e.g. bank accounts, brokerage accounts, retirement accounts, life insurance policies, etc.). In either case, there may be no need to go through the probate process after you die to transfer assets to your beneficiaries that have these options, as the surviving owner or beneficiary is predetermined.
In terms of considering who you want to pass your assets to, there is not much to say in this space, as that is a highly personal decision. But there are other related items to consider, such as whether it would be appropriate for your beneficiaries to receive your assets outright after you die (versus being held in trust) and whether limitations should be made on the distribution of these assets (e.g. conditions for the beneficiaries to meet, discretionary standards to apply to your agent who will have the authority to distribute your assets, etc.). Additionally, considering potential agents under a will, trust, power of attorney, etc. is also a very personal decision, but there are certain basic factors to contemplate like a person’s availability and willingness to serve, how much personal knowledge a person has of your assets and beneficiaries, your trust in a person’s decision-making skills, etc.
There are many other questions to consider, but looking at these items first is an excellent start. And a skilled and conscientious estate planning attorney can help guide you to the next steps. If you have further questions or would like to discuss starting your estate plan, please do not hesitate to contact us.