THE INSIDE TRACK ON LIVING WILLS

Living Wills

Even if you’re not a frequent visitor to the doctor’s office or rarely get sick, it’s important to make decisions now about your future healthcare. A living will is a document or description on how you want future healthcare issues to be handled in the event that you become unable to make those decisions on your own. It’s never pleasant to think about what would happen if you couldn’t think or act for yourself, so make sure to take care of this issue early on. Your wishes could still be carried through, even if you aren’t able to communicate them properly in the future. In a living will, you will be able to specify what should happen regarding life-sustaining procedures and treatments, as well as artificially provided nutrition. It might also be smart to look into the option of “double power of attorney,” which is a status where you can enlist your spouse or family member to make decisions on your behalf.

What Happens If You Don’t Have a Will or Trust?

Dying intestate is the legal term used for someone who died without a will. If you don’t specify who will receive your personal belongings once you pass away, the state will control and distribute your property to your spouse and/or your closest heirs.

If you don’t nominate a guardian for your minor children before you pass away, the state makes the decision in appointing who the legal guardian will be. Also, if you don’t appoint a person to carry out with your wishes, the state can appoint anyone to be the administrator of the property. The administrator may also have to pay various fees at your expense of your estate before he or she can distribute your assets.

The Importance of Estate Planning

Estate planning: It’s something no one ever wants to deal with or plan. It’s only human that we don’t want to spend too much time thinking about what would happen after we’ve passed away. However, it is extremely vital that a person’s assets and/or estate are properly taken care of. Without proper assessment of a comprehensive estate plan, all of the work you’ve done throughout your life could be lost or given to the wrong beneficiaries.

In prior generations, it was believed that only the wealthy population ever had to deal with estate planning. However, in today’s age, even middle-income earners are learning for optimal ways to invest their money throughout their lifetime to make the most of their income.

The purpose of estate planning is to aid in the preparation of the transferring of your assets to others upon your death. You will be able to specify where each of your assets will go once you pass away, by determining the recipient, what he or she will receive and how to carry out each transfer with minimal tax consequences to the recipient, provided that the estate has enough liquidity to meet its instructions. Estate taxes can also be minimal to the owner of the estate given that advanced estate planning has been established.

It’s also extremely important to understand that property laws can vary from state to state so it’s imperative that you speak with an estate attorney and a professional in the finance industry to properly engage your situation under the appropriate state regulations.

Net Worth: The First Step

Before you start thinking of the people who will benefit from your assets, you’ll first need to determine what you have when you die. The term “estate” refers to all of the assets you own, such as material investments, real estate, property, life insurance, personal possessions, cash retirement accounts and anything else of value. At the time of death, any debts should be subtracted from your total asset amount to best determine your overall net worth.

Taxation is another factor to keep in mind when determining your net worth. Figure out how much you will have to pay in taxes and this will best reveal how much your beneficiaries will receive. For instance, some states have estate taxes, paid by you, and other states have inheritance taxes, paid by the beneficiary.

Reasons for Advanced Estate Planning

There are three main reasons for advanced estate planning:

1.  A reduction in estate taxes – This happens when assets are distributed as a gift, such as a highly appreciated stock into a trust for the benefit of a spouse or children, or for the benefit of a charitable organization, corporation or business. Once the asset is gifted into a trust, the estate owner can no longer use the asset for their own tax purposes.


                           written by Brad Richdale TM copyright 2010 all rights reserved
                                        blog by Bradford Richdale


                     Brad Richdale is the creator of the Brad Richdale Internet Yellow pages