Frequently Asked Estate Planning Questions
Estate planning is a process where you begin a process which involves acting intentionally about the future of your financial affairs and property. The creation of a will or trust is the most frequently utilized vehicle when it comes to preparing your estate for an end-of-life circumstance.
If you die without a will and are a resident of Texas, then the intestacy laws of Texas will determine how your estate is distributed. Family members such as your spouse and children stand to inherit your property, but more distant relatives may also inherit property of yours if you have no children or spouse. If after a diligent search a probate court cannot locate eligible family members to inherit property, the State of Texas would become the recipient of any property owned by your estate at the time of your passing.
A will directs a specific individual, known as an executor, to assist how your property should be distributed after your passing. A will provides you with control as how the affairs of your estate should be handled rather than relying upon the intestacy laws of the State of Texas to determine where and to whom your property should be distributed at the end of your life.
Your “estate” is represented by property such as real estate, personal property, bank accounts and investments. Additionally, your estate might be comprised of various debts such as a mortgage, personal loans, home equity lines of credit and credit cards. Prior to your property being distributed upon your death, your creditors must be given an opportunity to assert a claim against your estate to be paid back whatever money is owed to them.
A living will is a written statement detailing your desires regarding your medical treatment in circumstances in which you are no longer able to express informed consent, especially with a healthcare/advance directive.
Probate is the legal process that occurs when you die which involves determining the validity of your will (if any) and then the administration of that will. This process will be completed when you leave assets to distribute. If you die without a will, your estate will go through the probate process.
A trust can be created to ensure that your assets are managed according to your wishes while you are alive and after you have passed away. A trustee will be named within your trust to administer the legal contract. Trusts can potentially avoid the probate process, can provide tax benefits and are many times more flexible than a will.
Power of attorney is the authority to act for another person in specific or in all legal or financial matters. A power of attorney also refers to a legal document which grants power of attorney to a person or entity.
While you cannot leave money or other property to your pet in a will or trust, but you can plan to ensure your pet is provided for if you predecease your furry, feathered or finned friend. For example, you can use your will or living trust to leave your pet to a person who you are confident will be able to care for him or her. Money can be set aside in a living trust for the care of your pet, specifically.
Guardianship is a legal process that is undertaken when a person can no longer make good decisions for themselves. Guardianship allows another adult to be able to intercede into the incapacitated person’s life to make decisions on their behalf and also care for that person whether he or she is an adult or minor.