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Taking the Fear Out of Estate Planning


Most Americans know how important it is to create a comprehensive estate plan. Yet over half do not have one in place. One of the more common reasons people give for why they have yet to sit down and create an estate plan boils down to a fear of the unknown. Estate planning, by nature, involves concepts and procedures that most people are unfamiliar with, leading to apprehension, confusion, and ultimately procrastination. One way to take the fear out of estate planning is to become familiar with some of the more common components of an estate plan ahead of time. A basic understanding of what goes into a typical estate plan, and why each piece and each step is important, may help erase some of the apprehension and prompt you to finally start working on your plan.

DECIDING ON PRIORITIES AND GOALS The first step in any estate plan is to identify what your priorities and goals are for the plan. For some people, disposition of estate assets is both the only priority and only goal; however, for most estate planners this is only the tip of the iceberg. Some of the other common goals of an estate plan include:  Incapacity planning  Funeral planning

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Estate Planning Basics: Taking the Fear Out of Estate Planning


 Retirement planning  Funding for future education  Providing long-term income to a spouse or child  Pet planning  Business succession planning  Medicaid planning  Probate avoidance  Estate tax planning Although this may appear to be a long and complicated list, rest assured that each of these areas can be addressed in a comprehensive estate plan.

THE FOUNDATION -- YOUR LAST WILL AND TESTAMENT Just as building a home starts with the foundation, so does building an estate plan. A Last Will and Testament can include a wide variety of information; however, among the most important things your Will can do are:

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Estate Planning Basics: Taking the Fear Out of Estate Planning


 Bequeath gifts to beneficiaries—gifts may be specific such as a family heirloom or general such as a percentage of your entire estate.  Nominate a guardian for minor children—this is your chance to select a legal guardian for your children in the event that you and your spouse/partner are both unable to care for them.  Provide a guide to other estate planning documents—your Will often references other estate planning documents so that the executor knows what else you have created and how those documents fit into your overall estate plan.

PLANNING FOR A TRAGEDY--INCAPACITY PLANNING DOCUMENTS Tragedy can strike at any time and at any age. While there is nothing you can do to prevent a tragedy from happening, you can make important decisions now that will determine who will control your estate and who will make decisions for you if you become incapacitated at some point in the future. In the absence of an incapacity plan, a court will decide who controls your estate and make decisions regarding your health care. In the State of New York, there are two important documents that you may choose to include in an incapacity plan – a health care proxy and/or a Living Will.

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Estate Planning Basics: Taking the Fear Out of Estate Planning


A health care proxy allows you to appoint someone who will be able to make health care decisions on your behalf if you are incapacitated. A Living Will affords you the opportunity to decide, in advance, under what conditions you wish to decline medical treatment. Other documents, such as a durable general power of attorney or trust may also be used to transfer control of your estate assets to someone if you become incapacitated.

PROTECTING YOUR LOVED ONES – TRUSTS, TRUSTS, AND MORE TRUSTS A direct gift of estate assets may not be the best way to protect your loved ones in the event of your death. First, a direct gift may subject your estate or your loved one’s estate to a hefty tax burden. Second, gifts bequeathed in your Will are not typically immediately available to your beneficiaries which can create a financial nightmare for those left behind. Finally, it is often better to provide for long-term income instead of one lump sum

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because it creates more stability and security for your beneficiaries. For these reasons, you may choose to include at least one trust in your estate plan. Trusts

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Estate Planning Basics: Taking the Fear Out of Estate Planning


come in an infinite number of varieties; however, they all require the same four basic elements : 1. A grantor—the person who creates the trust 2. A trustee – the person who is responsible for administration of the trust 3. A beneficiary – the person who will benefit from the trust assets 4. Assets – you can fund the trust with cash, property, life insurance proceeds, or almost any other type of asset. Because trusts are so versatile, you can create a trust for almost any purpose.

Furthermore, you can include trust terms that can accomplish almost any goal. For example, you could create a pet trust to ensure that your family pet is cared for or a special needs trust for a child who faces physical or mental disabilities.

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Estate Planning Basics: Taking the Fear Out of Estate Planning


PLANNING FOR YOUR GOLDEN YEARS

Your estate plan can go a long way toward planning for your golden years. Americans are living longer and many of them will require long-term care or increased health care as they age according to the Centers for Disease Control and Prevention, or CDC. Long-term care planning and Medicaid planning are things that should be considered now, before they actually become an issue in the future. Failing to plan for the possibility that you may need Medicaid or longterm care assistance at some point in the future can result in a loss of benefits and/or a loss of estate assets.

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Estate Planning Basics: Taking the Fear Out of Estate Planning


About the Author

For more than 30 years, Bart Levine has been the principal member of the Law Offices of Barton P. Levine. Mr. Levine specializes in estate planning, probate and estate administration, bankruptcy representation, special needs planning, medicaid planning, guardianship representation, elder law representations and real estate representation. Mr. Levine presents free educational seminars to the public throughout the greater New York City metropolitan area. These seminars are intended to educate the public about the importance of proper estate planning. Seminar topics include Basic Estate Planning, Asset Protection, Special Needs Planning, Medicaid Planning, Estate Planning for the GLBT Community, IRA Planning and many others. Mr. Levine also presents continuing education courses to the professional community. To arrange for a free initial consultation, call us toll-free at (888) 268-4425, or contact us online. Law Offices of Barton P. Levine 260 Madison Avenue, 17th Floor New York, NY 10016 Phone: (212) 268-1177 www.New-York-Estate-Planning.com

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Estate Planning Basics: Taking the Fear Out of Estate Planning


Estate Planning Basics: Taking Fear Out of Estate Planning  

Estate planning, by nature, involves concepts and procedures that most people are unfamiliar with, leading to apprehension, confusion, and u...

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