Estate planning can sound intimidating and seem like it’s only for the super wealthy. But people in Florida should understand that estate planning is necessary for every adult. An estate plan includes everything from a will to life insurance policies and sometimes finance-oriented documents like trusts. In order to craft a comprehensive estate plan that covers all contingencies, it’s recommended to get advice from several professionals.
An estate plan isn’t just about death
Everyone knows that making an estate plan means writing a will, but it’s not just about death. The plan is all about what will happen should someone be unable to make decisions for themselves. Power of attorney and health care proxies determine who handles financial and medical decisions for someone who can’t do it for themselves.
An executor, financial power of attorney and the agent named in a health care proxy are all fiduciaries. This means they are expected to make decisions for the benefit of someone else, not for themselves. Lawyers may draft all of these documents, but they will sometimes do so with input from financial advisors or other professionals.
Taxes and estate planning
It’s a good idea to think about the tax burden than can come with passing on an estate. The federal estate tax is very low right now, and Florida has no estate tax. That may change in the future, so instruments like trusts can help insulate against that risk.
Trusts can make it possible to pass resources on to spouses and children without paying taxes on them. Trusts may help transfers move more quickly, which can be a great thing at a time when families are dealing with expensive end-of-life arrangements. An experienced lawyer may be able to explain more about creating trusts as part of an estate plan.