Estate Planning 101: All You Need to Know About Estate Planning

estate planning 101

No matter how old you are, it’s never to early to start some estate planning.  Some simple measures can make a world of difference for you and your family, even if that eventuality is way in the future.

You also do not have to be a multimillionaire to take advantage of the laws surrounding trusts and estates. Some careful planning with the assistance of a qualified attorney can help you make preparations now while you are creating your legacy.

Here is a broad overview of Estate Planning 101 to help you get started. These questions will help guide you as you begin to plan for the future.

1. Where Do You Live? 

When you begin to plan your estate, you first need to consider where you live.

If you live in Wisconsin, you will not have a state estate or inheritance tax. However, if you own property in a state that does have this kind of tax, like New Jersey or Pennsylvania, that state may levy taxes on your beneficiary or your estate.

If you are very wealthy now or in the future, your estate may be subject to federal taxes.

However, there are other financial benefits to estate planning, even if you do not expect a large tax bill. If you place certain accounts in trust for your children, they may derive tax advantages while the money grows over time.

2. What Do You Have? 

Owning property, a business, life insurance, or other items of value means you should plan for their distribution after your death. 

The more money you have, the more you need an estate plan. However, even people who consider themselves middle class can benefit from having a will and even trusts to determine who gets what. 

If you have a large family, you may want to specify who gets how much of your estate. You may wish to include only those who will need it. You may wish your money to go to your children, but to be managed by another family member until they are aged 25 or 30.

Passing your assets to beneficiaries through a trust can also be more expedient than going through probate. Probate can be a long and contentious process. If you plan your estate carefully, the people you leave behind will have access to your property and money through a trust more quickly.

3. Who Do You Take Care Of?

If you have small children, you should have a will and estate plan. No one in their twenties or thirties likes to think they may die one day, but unfortunately, terrible things do happen. You want to take care of your family, just in case the worst happens.

In addition to making financial arrangements for your children, you may also want to designate who will take care of them. Some wills will name a guardian for minor children if both parents die.

You may also name someone to administer the estate, (control the money) after you pass away. They might be given the responsibility of deciding on what the money in the estate can be spent for the benefit of the children. For example, they might be able to approve college tuition but not the purchase of a motorcycle.

If you have someone with disabilities in your family who is unable to work for a living, you may want to make special provisions. There are trusts that can be set up for the benefit of disabled people which provide special protection. These special needs trusts may be funded by an inheritance from you.

These trusts aim to ensure that your family member is taken care of throughout their life.

5. Who Do You Trust to Take Care of Your Affairs? 

When you plan your estate, you must choose someone to pay your debts, distribute your assets, and make sure that all of your wishes are followed. This will be your Personal Representative. 

You can give your Personal Representative a wide range of power, including the ability to file taxes on trusts, distribute monies to beneficiaries, and even arrange your funeral.

Your Personal Representative can be your spouse, a trusted child or friend, or a lawyer or accountant. You should also name alternative Personal Representatives in case they predecease you.

You can also assign someone the responsibility to make end-of-life medical decisions on your behalf.

6. What Does Your Family Structure Look Like? 

Did you remarry late in life? You may want to make specific provisions to leave your estate to the children of your first marriage.

Do your children fight over money frequently? Is there a member of your family who is unworthy of inheriting from you? 

Are your family members well off, or do you want to teach them the true value of hard work? You may wish to give a portion or all of your estate to a charitable organization.

Estate planning will solidify your wishes to reduce infighting in your family and make sure your assets go to whom you want them to go. 

7. How Do You Want to Enjoy Your Retirement? 

Estate planning specialists and lawyers can help you get the full value of your money before you die.

Estate planning should start well before you retire.

Estate Planning 101: Not As Hard as You May Think! 

Estate planning 101 does not have to be difficult or morose. In fact, it is a great feeling to understand you can make the most of your income and provide for yourself and your family in the future. 

By exploring your options and setting up your affairs now, you will reap the rewards for a long time to come.

For more information on planning your estate, contact us

Wisconsin Estate Planning Documents You Need

estate planning documents

Estate planning is a necessary part of preparing for the future. However, in the here and now, the necessity of estate planning documents may not be incredibly apparent. Unfortunately, it often takes the worst-case scenarios to bring the importance of estate planning to light.

This post outlines estate planning documents every Wisconsin resident should draft before they are needed and why it is so important to make  estate planning a top priority.

Will

This estate planning document is one of the most well-known and well-misunderstood. There are several  misconceptions surrounding wills, but its also one of the most-needed estate planning tools.

A will is a legal tool for a person to express their wishes when they cannot. Unfortunately, verbal expressions are not enough to spur action in the State of Wisconsin. For example, telling a relative they can have an heirloom does not make the item exempt from a battle among family members.

People can use a will to detail these wishes:

  • Which persons or organizations should receive assets from the estate
  • Which person is responsible for the care of minors in the household (if the other parent should also be incapacitated)
  • The person or organization that serves as the executor of the estate and is responsible for settling the estate (including distributing assets)
  • If a trust is established for asset distribution


If there is no will drafted for an estate, the distribution of assets and settling of debts is handled by other parties who may not follow the wishes of the decedent. In Wisconsin, a legal will must be drafted (ideally by an  estate planning professional) and signed by the individual as well as two witnesses. The witnesses should not be beneficiaries who receive assets as spelled out in the will or lawful heirs of the estate. It is also recommended that the will is stored in a safe location in the full knowledge of a trusted person.

Durable Power of Attorney

A Durable Power of Attorney designates a party who can make financial decisions when an estate owner is unable to do so. This is essential for situations when a person is sick or hurt, and financial matters need to be handled during this time. The lack of a Durable Power Attorney can leave family and friends struggling during what can be a very difficult time.

A Durable Power of Attorney is only applicable when a person is alive; this power ends when the person dies. The person can express in the document what financial matters can be handled. A Durable Power of Attorney can give an agent the right to purchase and sell real estate, pay for expenses, and sign legal documents on the individual’s behalf.

Healthcare Power of Attorney

A Healthcare Power of Attorney is a separate estate planning document from the Durable Power of Attorney. This estate planning document designates an agent to make healthcare decisions for another. This agent can be the same as the will executor, party named in the Durable Power of Attorney, or can be another party.

This estate planning document can be incredibly important when a person cannot make the decisions or express their wishes because of a health issue. In these cases, a agent can make decisions and carry out any wishes previously stated.

The materials on this website are provided for informational purposes only and do not constitute legal advice. These materials are intended, but not promised or guaranteed to be current, complete, or up-to-date and should in no way be taken as an indication of future results. Transmission of the information is not intended to create, and the receipt does not constitute, an attorney-client relationship between sender and receiver. You should not act or rely on any information contained in this website without first seeking the advice of an attorney.

Guide to Creating an Estate Plan in Wisconsin

family walking on beach after estate planning in wisconsinMost Wisconsin residents associate estate planning with drafting a will—and nothing more. In reality, there is more to the process, such as drafting directives that guide family and friends during difficult times. As a whole, an estate plan is a package of legal documents that lead to an optimal financial outcome and expedient process for all parties involved and detail the wishes of the incapacitated or deceased.

Because everyone’s situation varies, the exact estate planning documents and arrangements needed are different for every household (and sometimes for individual household members). The details of an estate plan can also vary from state to state. In general, however, the initial steps for creating an estate plan are similar, including where to start the estate planning process.

Gather information about assets and liabilities.

Estate planning is not entirely about financial matters; however, finances are an integral part of every estate plan. To give professionals a comprehensive view of the financial situation, compile a list of assets and liabilities. This information should include financial accounts, life insurance policies, any financial debts, and other liabilities that needs to be factored into the estate. This information can also be used to calculate the net worth of the estate; this step needs to be done to determine if and what taxes the estate is subject to.

Have important discussions.

Beyond the owner of the estate, there are other parties that are named in estate planning documents. These parties need to be chosen, including:

  • Beneficiary or beneficiaries. These parties receive assets from the estate. Beneficiaries, commonly called heirs, can be individuals (i.e. family members, friends, associates) or organizations (i.e. charities).
  • Executor. This party should be a responsible individual that ensures all the terms of the estate planning documents are executed. An executor can be a friend, family member, or associate, such as a lawyer or other firm.
  • Guardian. This party is named as the caregiver for minors when the owner of the estate is incapacitated or deceased. (Read more about choosing and naming a guardian for children.)

A discussion with these parties is not required for estate planning; however, discussions can be invaluable with all parties involved (including friends or family members that are not named in the estate plan) so the execution of the estate plan is seamless and efficient. When executors, beneficiaries, and guardians are named, information about the parties should be collected (contact an estate planning lawyer to find out what information is needed). If the choice of beneficiaries, executors, or guardian changes, these parties can (and should) be changed and updated.

Contact an experienced local estate planning lawyer.

There are several different estate planning options, such as a will, advanced directives, irrevocable and revocable living trust. An experienced, local estate planning lawyer can recommend the best documentation and arrangements suited to the specific situation. Bring all information to the meeting, including the list of assets and liabilities and information about parties that should be included.

The materials on this website are provided for informational purposes only and do not constitute legal advice. These materials are intended, but not promised or guaranteed to be current, complete, or up-to-date and should in no way be taken as an indication of future results. Transmission of the information is not intended to create, and the receipt does not constitute, an attorney-client relationship between sender and receiver. You should not act or rely on any information contained in this website without first seeking the advice of an attorney.

 

Time for a Will? 5 Things You Need to Get Started

Estate planning worksheet for writing a willIt’s never too late (or too early) to get a will drafted for the good of you and your family. A will is one of the most important (or the most important) documents in your estate plan, both for asset distribution and as direction during very difficult time. This significant estate planning document can also become a vehicle for organizing your assets in preparation for the next phase of your life (i.e. establishing a trust, etc.) Because of its importance, it’s not a document to procrastinate drafting or to draft using a generic template.

Instead, contact a local lawyer who can produce a legal document in line with local and state regulations and conditions. To make the process extremely efficient, have these key pieces of information ready for the lawyer and for inclusion in your will.

List of assets

Not every asset needs to be included in your will, but you should have major assets listed. Do an inventory of your assets (including bank accounts, lock box contents, items in safe, properties, etc.), and be prepared to give your lawyer a list of major assets.

Beneficiaries

Once you’ve compiled a list of assets, it’s time to decide who gets them when you pass. Your lawyer needs a list of beneficiaries and their personal information (i.e. social security numbers, address, etc.) If you want to be very precise about certain items and who receives them, decide that information before you visit your attorney so you can provide very exact directions in your will.

Executor

An executor is named in your will to carry out your instructions. For that reason, choose your executor carefully; your executor should be a responsible individual (not necessarily a family member) who can follow your instructions and deal with any estate issues that arise.

Guardian

If you have any minors in your care, you’ll need to name a guardian to care for them. Bring the name of the guardian, as well as personal information about the individual, so the person can be named. If you want to leave any assets for your minors’ care, spell out those instructions to your lawyer.

Any other instructions

Specific instructions, even if they don’t fit one of the above categories, should be included in your will. For example, if you don’t want certain family members named as beneficiaries, that should be spelled out so the courts don’t see it as an oversight.

The materials on this website are provided for informational purposes only and do not constitute legal advice. These materials are intended, but not promised or guaranteed to be current, complete, or up-to-date and should in no way be taken as an indication of future results. Transmission of the information is not intended to create, and the receipt does not constitute, an attorney-client relationship between sender and receiver. You should not act or rely on any information contained in this website without first seeking the advice of an attorney.