18 Mar The 7 Most Common Estate Planning Questions Answered
If you’re just starting your estate planning journey, chances are good you have lots of questions, and you need some answers. It’s perfectly normal to have lots of questions to ask an estate planner, and the experts at Phelps LaClair are here to help. To get you started, here are our answers to six of the most common estate planning questions.
Estate Planning Questions People Usually Ask
Question 1: What exactly is an estate plan, and do I really need one?
This is one of the most frequently asked questions we hear. People know that they should have an estate plan, but many times they’re not sure what an estate plan is. Or, they think an estate plan is just for those living a lavish lifestyle and not for ordinary folks.
An estate plan is essential for anyone who owns property or other assets, including:
- Real estate
- A business
- Investments
- Cash
- Vehicles
- Insurance policies
- Retirement plans
An estate plan ensures protection for what you own if you are suddenly unable to take care of yourself. And it makes arrangements for the distribution of your personal property after you die, based on your wishes.
Question 2: What is the difference between a will and a trust?
Most people have heard about a will and understand what it is. However, they sometimes become confused when they hear about trusts and they wonder which is better—a will or a trust? And do they need both?
A will documents your distribution plan for your personal property after your death, and names an executor who will carry out its directives.
A trust also dictates the distribution of your assets. However, trusts offer some different options, including the ability to set up a living will in case you become incapacitated and require care. Trusts also ensure privacy—wills are public records, but trusts are not.
Question 3: What happens if I die without a will?
A person who dies without a will is dying intestate. When that happens, their assets, such as their house, enter probate in the court of the county where they lived. From there, the court decides who gets that person’s assets. If a family member wants to request ownership of the property, they must go through the courts and it can take a long time—even years—for the court to make a decision.
Question 4: What is a Power of Attorney?
A power of attorney is a legal document that allows you to designate a person who will make decisions on your behalf, just in case there comes a day that you cannot do it yourself. Your designated power of attorney should be someone you fully trust—such as a spouse or partner, sibling, or adult child. Your POA can make many decisions in regard to your healthcare and finances, but they are unable to make changes to your will or make any estate decisions after your death.
Question 6: How frequently should I update my estate plan?
Life comes with many changes. Whenever you have a big change in your life or changes to assets, you need to update your estate plan. These types of changes include:
- Buying or selling a home
- Purchasing another large asset, like a boat
- Starting or selling a business
- Birth or adoption of a child or grandchild
- Marriage or divorce
- Death of a family member involved in your estate
Question 7: Do I need to hire a lawyer to set up an estate plan? Can’t I just set one up online?
There are websites out there claiming that creating an estate plan is as easy as checking a few boxes and pushing a few buttons. The hard fact is that nothing is ever that easy. People are always upset to find out that an online estate plan does not hold up in court, leaving a costly mess for their family members to untangle. Hiring an experienced estate planning attorney is the only way to make sure your estate plan is set up correctly and follows your exact wishes.
Get Your Estate Planning Questions Answered in Phoenix, Arizona
Here at Phelps LaClair, our seasoned estate planning lawyers have over 40 years of experience in helping Arizona residents plan their estates and answering their estate planning questions. If you’re ready to take the first steps, contact our offices today at 480-892-2488. Our professional estate planning team will give you the answers you need.
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