Preparing your estate can be a long, tedious, and emotionally taxing process. Perhaps this is why so many people don’t give estate planning its proper due - until it’s too late.
Indeed, according to recent reports, more than half of all American adults do not have a valid will and testament in place. For that reason, many people who do draw up a will have an unfortunate tendency to consider things conclusively settled and done.
After all, with a will, you’re accounting for the distribution of your assets, establishing who will act as your executor, and naming guardians for your children… So you must be good to go, right?
Unfortunately, even with a will, you’re not quite out of the woods yet.
While your will is an incredibly important estate planning document, it’s crucial to realize that it is not the only thing that matters when it comes to estate planning and administration.
Estate planning is a multi-faceted, ongoing process with lots of moving parts that must all be accounted for. In fact, there are many common estate planning matters that fall outside of the purview of a will, such as…
Planning for Incapacity
While most of us prefer not to think about such dark matters, the reality is that, at any moment, a sudden accident or critical illness could leave you incapacitated and unable to handle your own affairs.
A vital aspect of estate planning that often goes overlooked is the need to leave guidance for your family or caregivers to follow, in the event that you can no longer make or communicate your own decisions.
One crucial way to plan for the unexpected is to leave a living will (also often referred to as an advanced healthcare directive or declaration). This important mechanism allows you to dictate your end-of-life wishes ahead of time, should you become incapacitated or otherwise unable to communicate with your loved ones.
At the same time, it’s important to consider the costs and logistics associated with long-term care, including insurance and medical bills. Have you set up a way for your family or friends to cope with these costs and keep track of your arrangements?
Naming a Power of Attorney
Whether because of age, illness, or incapacitation, there often comes a time when it becomes difficult, if not impossible, to clearly communicate your wishes and make all of your own decisions. For that reason, an important legal mechanism to consider as part of your comprehensive estate plan is naming a power of attorney.
Often used in conjunction with your living will or advanced directive, a power of attorney is an individual or group that you grant the ability to make decisions on your behalf, in line with your stated guidance. It’s important to note that there are different types of power of attorney designations, with differing scopes of authority and levels of access.
In most cases, Illinois residents should consider naming a durable power of attorney for health care (which will enable a chosen person to act as your health care proxy, and make medical decisions on your behalf), and a durable power of attorney for finances (which allows your named agent to handle financial and property matters on your behalf).
Transferring Property Outside of Probate
In most cases, the death of an individual triggers the start of the probate process. For clarity’s sake, we can think of probate as the legal process by which the courts ensure that all of the deceased’s property is properly distributed, in line with the individual’s wishes and in accordance with all state and local laws.
Probate can be an expensive, time-consuming, and frustrating process under the best of circumstances. Recent statistics show that a complicated will may take over two years to probate; it’s also important to remember that even a simple one takes at least six months.
To help expedite the process, preserve their privacy, and help ensure that their family is provided for in a difficult time, many people choose to take steps to help their assets avoid probate, wherever possible.
There are many mechanisms a person can use to help certain assets avoid probate, including placing assets in a secure trust; naming beneficiaries for certain accounts and property; and maintaining ownership of property jointly, with rights of survivorship.
The Bottom Line
In Illinois, having a well-crafted and well-documented estate plan in place is one of the most important things you can do to protect yourself, your assets, and your loved ones in the good times and the bad.
In many cases, tackling the many pieces associated with estate planning is a more daunting and far-reaching process than many people anticipate. It’s also important to realize that estate planning is not a one-size-fits-all proposition; everyone’s estate will be slightly different and unique in its own ways.
For that reason, many people find that speaking with an experienced professional helps provide the personalized attention it takes to get the estate planning ball rolling, and ensure that every base gets covered - whether that means planning ahead for incapacitation, understanding power of attorney, or taking steps to help your assets avoid probate.
Don’t hesitate to get in touch to further discuss your unique circumstances and any personal questions you may have about estate planning, administration, and probate for the Chicago area!
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