Estate Planning - Power of Attorney
Estate Planning can be a very complex task sometimes but a well-informed plan could make a big difference. Before you begin to take action on your estate plan, it's important to understand that the attorney will make a lot of difference to your loved ones.
Here are the reasons for what special power of attorney could do:
• Working with an attorney or tax advisor
It's important to work with an attorney and possibly a tax advisor on your estate planning. The role of attorney may include making a will online, a living will, health care proxy, and special power of attorney.
An attorney or tax advisor can be well worth the cost—significant savings can result from thorough, informed planning.
• Maximizing what you leave behind
It's important to get legal or tax advice and think through how each asset will pass to your beneficiaries, as well as your estate as a whole. You'll want to be thoroughly informed on what actions you can take or plan now in estate planning to make sure as little as possible is lost to taxes, court fees, and other expenses.
Now the most important point that an attorney will suggest you have a living will. A will is a legal document that contains the distribution of the assets after your death. It is very mandatory to have a living will otherwise the law has to decide for the distribution of your assets to your loved ones. You can prevent this from happening by having documents drafted that reflect your wishes.
A will generally include:
• Designation of an executor, who carries out the provisions of the will.
• Beneficiaries—those who are inheriting the assets.
• Instructions for how and when the beneficiaries will receive the assets.
• Guardians for any minor children.
You can now make a will online also. It is an easy process. The most important thing that you need to mention while making a will online is to name the beneficiaries. For assets that move outside the will and probate process, if the named beneficiary conflicts with anything stated in the will, then the named beneficiary prevails. This means the named beneficiary will receive the asset, rather than anyone else named in the will, and usually, the asset will not have to go through probate.
Thus, it's essential to name beneficiaries on assets that allow it and to keep those designations up to date. Note that, generally, if you are married and you name anyone other than your spouse as a 401(k) beneficiary, consent of your spouse is required.
For assets that do not allow for the naming of beneficiaries (such as some bank accounts and real estate), the will is the place to designate who will get them, as well as any related special instructions.
Some types of assets allow for the naming of beneficiaries (such as IRAs and investment accounts), which enables a direct transfer of the asset without involving the will and has greater authority than the will. These types of assets usually avoid probate and the associated fees and may avoid certain taxes, helping you maximize what you leave to your beneficiaries.