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Do I need an Estate Plan

Exterior of estate, white house with green roofThe question of whether you need to draft an estate plan is common. There are no legal requirements that you have an estate plan and Michigan even has default laws for how to distribute an estate in the event that a person doesn’t have an estate plan. However, that does not mean it’s wise to avoid estate planning. Knowing when you are going to meet your demise is the great unknown in life and is a shock to family, friends and other loved ones. Without an estate plan though, the difficulties of losing a loved one can become even more stressful for family and friends attempting to wind up your affairs.

It seems almost somewhat regular now that when a famous person dies, there is a news article about how they did not have a will, trust or any estate planning documents leaving their relatives to publicly fight over their estate. These news articles show that even the famous and wealthy often fail to properly plan. While most of us don’t have the worry of public fighting and disagreements among our heirs, no one wants their legacy to turn into a fight among loved ones.

There are many reasons most people don’t have estate plans. Some feel they don’t have an estate worth planning for, some people also put off or avoid estate planning simply because they don’t want to confront their own death. It can be difficult to ponder situations where you are infirmed or dead and plan for what comes next. Whatever the reason for not having an estate plan, it is worth considering if you need one and what that entails.

Understanding what estate planning consists of is the first step to determining whether or not it is appropriate for you. The term “estate” is referring to your property and assets. Estate planning is the umbrella term which covers wills, trusts, powers of attorney and other relevant documents for managing your property and assets not just when you die, but also if you become incapacitated or unable to handle your own affairs. While almost everyone knows and understands what a will does, there are many other documents that can be included in an estate plan for other situations as well.

Powers of attorney can give authority to designated persons to manage your financial affairs and health care if you were to become unable to do so on your own. Depending on your wishes, they can be effective under only certain narrow circumstances when you are incapacitated, or even effective immediately should you have the need for someone to act immediately on your behalf. Powers of attorney are a valuable tool of any estate plan because with the advances of modern medicine, people generally aren’t healthy one day and die the next, it is common for there to be a gradual decline in health to the point where a person is no longer able to handle the everyday  tasks of managing their affairs. With a properly drafted and executed power of attorney, there is no need to seek court involvement to gain guardianship or conservatorship over a person in order to act on their behalf. Your designated agent can act immediately when they become effective (which depends on your wishes and how the power of attorney is drafted).

Many people have heard of trusts but do not necessarily understand how they operate, what their purpose is, find them to be unnecessarily complicated, or believe they are only for the wealthy. A trust, in simple terms, is an arrangement where someone holds property for a beneficiary. In Michigan, a person may have a inter vivos or living trust, where their property is in the trust and they are the beneficiary of the trust. One of the main purposes for a trust like this is that so your property is already in the trust when you die and there is no need for probate court involvement upon your death. The subsequent trustee can manage the assets in the trust for the successor beneficiaries in accordance with your intent. There are various reasons for trusts and depending on your particular situation, a trust may be not only appropriate, but the best solution for your needs.

Wills are the most common instrument involved in estate planning, but the will has a very narrow purpose. It merely directs how to distribute your property and assets upon your death. Documents for Last Will and TestamentUntil you die, a will is not effective, and once you die it is the controlling document regarding your estate. Usually, wills designate who will be handling your estate, in Michigan this person is called a personal representative of the estate, in other jurisdictions, this may be called an executor or administrator. The personal representative is responsible for gathering up your assets, and distributing them how you described in your will. If you die intestate, without a will, the personal representative is limited to distributing your property in accordance with the intestate laws.

These are the primary documents referred to when people talk about estate plans and they can be more involved and tailored to your specific needs. Taken together they can serve your needs and see to it that you’re prepared should something happen to you. While an estate plan will never totally prevent your family and heirs from fighting over your estate, it can certainly limit them and spell out your last wishes for your legacy. Even if you don’t have a significant estate, or a large family, estate planning can still be beneficial and should not be overlooked. Consulting with an experienced estate planning attorney can help you determine the best manner to achieve your estate planning needs.

With over 25 years of estate planning experience, the Law Offices of Kathryn M. Wayne-Spindler, P.C. can effectively advise and counsel you on all of your estate planning needs. Contact our Milford office at (248) 676-1000 to discuss your estate plan today. We help clients throughout Southeastern Michigan, including Genesee, Oakland Livingston, Washtenaw, and Wayne Counties, as well as Mid-Michigan in Clare, Gladwin, Ogemaw, and Roscommon Counties. Our experienced attorneys have counseled such clients in Milford, Hartland, Highland, White Lake, Commerce, Walled Lake, Waterford, West Bloomfield, South Lyon, New Hudson, Brighton, Howell, Ann Arbor, Holly, Fenton, Flint, Linden, Clarkston, Houghton Lake, Higgins Lake, Roscommon and many more local communities.