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What components to estate planning are there?

| Jan 7, 2021 | Estate Planning & Probate

Estate planning in Minnesota involves taking several steps to increase the chances that all documents are in order and legally binding. Individuals who choose to use generic forms found on the internet might end up signing ambiguous documents. When taking part in estate planning, it is beneficial to consider all the many facets. Otherwise, heirs and beneficiaries might experience additional difficulties.

A will might not be the only necessary document

A will represents the most well-known document in estate planning. A will distributes assets of a deceased person through probate to heirs and follows the testator’s wishes. Without a will, Minnesota’s intestate statutes would guide distribution, which may be far from preferable.

Be mindful that a will does not handle any estate affairs for a living person. What happens if someone becomes grievously ill and cannot handle their financial affairs? A power of attorney form could transfer authority to a designated agent. The agent may access bank accounts, pay bills, file taxes and perform other duties. What an agent cannot do is make medical decisions. Thankfully, documents do exist for those situations.

Special considerations regarding health care and trusts

A health care proxy is similar to a power of attorney designation as it moves decision-making powers about health care to another person. A health care proxy is not the same as a living will, which outlines a living person’s directives for medical care when incapacitated or otherwise unable to make decisions.

In addition, a trust remains an option to add to an estate plan. A deceased or living person may spell out the management and distribution of assets to beneficiaries with a trust. For example, the trust may only distribute 10% of cash assets to beneficiaries per year.

An attorney may assist with crafting several necessary documents. Working with an estate planning attorney may help individuals complete the process accurately and thoroughly.