Estate planning for women is important, but it is often placed on the back burner. People live busy lives, and you have to juggle many responsibilities and do the things that you enjoy when you have the time. Your passing is certainly not a pleasant thing to contemplate, but it is one of the realities of life itself. In this post, we will look at estate planning for women from an overview in an effort to demystify the process.
The facilitation of postmortem asset transfers is at the core of the endeavor. A lot of people think that you simply draw up a will and you have an estate plan, but this is an oversimplification. Of course, you can use a will to state your final wishes regarding the way you want your assets to be distributed, but there are other options.
Benefits of a Living Trust
When you use a living trust, there are some advantages that do not apply to a will. First, contrary to popular belief, you do not lose control of the assets when you establish this type of trust. You will be the trustee while you are living, and you have total access to all property that you conveyed into the trust. At any time, you can amend the terms or rescind it entirely.
To account for the events that will take place after you are gone, you name a successor trustee to administer the trust, and you name the beneficiaries. You can use someone that you are personally acquainted with, or you can engage a professional fiduciary like a trust company or the trust section of a bank.
In the trust declaration, you can include a spendthrift provision if you choose to do so. This will protect the principal from the beneficiaries’ creditors. You can include stipulations about the way you want the assets to be distributed. When you create a trust, you don’t have to allow for lump sum distributions all at once. This is not the case if you use a will.
The estate administration process is not subject to probate when you use a living trust. On the other hand, if you utilize a will, the probate court would supervise. Under those circumstances, the inheritors will not receive anything while the estate is being probated. It will typically take at least eight months in most jurisdictions, and complicated cases can take considerably longer.
Other Types of Trusts
There are other trusts that can be utilized to accomplish targeted objectives. For example, let’s say that you want to leave an inheritance to a loved one with a disability. They rely on Medicaid for health insurance, and they receive income through the Supplemental Security Income program.
These are need-based benefits, so they can be lost if the financial profile of the beneficiary improves considerably. In a situation like this, you can establish a supplemental needs trust.
You name a trustee when you establish the trust, and they would manage the assets on behalf of the beneficiary. The beneficiary would not be able to directly access the funds, but the trustee could use the resources to make the beneficiary more comfortable in many ways. Benefit eligibility would not be negatively impacted.
Plus, there is the matter of Medicaid estate recovery. Medicaid is required to seek reimbursement from the estates of deceased beneficiaries. When a third party special needs trust has been established, the remainder that is left in the trust after the passing of the beneficiary would be protected. It would go to a successor beneficiary that you designate in the trust declaration.
This is just one example, but there are other types of trusts that can be utilized when you’re planning your estate. When you work with our firm to establish a plan, you will receive recommendations based on your unique situation.
After you address the financial part of the equation, you can move on to the other piece of the puzzle. This is another sensitive subject, but there are eventualities that you may face toward the end of your life that should be addressed.
The life expectancy for a 67-year-old woman is 87 years. Almost one-third of people that are in this age group contract Alzheimer’s disease. Individuals with Alzheimer’s disease can experience cognitive impairment that makes it impossible for them to make sound decisions on their own.
This is one type of incapacity, but it is not the only one. If you do nothing to prepare for this possibility and you become incapacitated, the state may appoint a guardian/conservator to manage your personal and financial affairs.
Obviously, it is far better to make your own choices in advance, and you can do this when you execute the proper documents. With a durable power of attorney for health care, you name someone to make medical decisions for you if it becomes necessary. For financial matters, you can include a durable power of attorney for property.
Getting back to the living trust, if you have a trust, you can name a disability trustee to administer the trust in the event of your incapacity.
Schedule a Consultation Today!
Estate planning for women can be complicated for a layperson, but we can break it down into simple terms and help take the right steps. When choose our firm, you will receive personalized attention, and your plan will be carefully prepared to suit your needs perfectly.
You can schedule a consultation at our Bluffton, South Carolina estate planning office if you give us a call at 843-815-8580, and you can use our contact form to send us a message.
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