While legal documents may seem obtuse and difficult to understand, they are crucial for estate purposes. If you plan to give away property or assets, you’ll need to create a will, trust document or other estate planning document. A trust document is especially important if you have to keep the money you give away out of your estate. A trust can be used as a buffer between you and the government, which could otherwise seize property by tracing remaining assets via property tax rolls. It also shields assets from possible creditors.

Trusts and Wills: 

A professional will create the documents to ensure that your property is distributed the way you’d like it to be in the case of death or incapacity. A professional will draft a will, living trust or other estate planning documents based on your wishes. A professional can also assist you in keeping assets out of probate court. Probate is a court-administered process through which administrators review your assets and financial records while seeking payment of estate taxes. If your estate is large or if you own property in more than one state, you may run into complications with the probate process. This can delay the transfer of assets to your beneficiaries while they are being dealt with in court.

An estate planning lawyer might also help you make a trust document that is easily modified throughout your lifetime. This makes it possible for you to change your testamentary directions at any time, should circumstances change or if new needs or desires arise. A professional will also help you with legal language and tax issues related to trusts.

Living Trust: 

A living trust is different from a will, and it can be one of the most effective ways to protect your estate. You can set up a living trust while you’re alive rather than waiting until your death, which allows you to alter it at any time without court administration. A living trust also doesn’t require probate or court approval. The way that money passes through a trust is determined by the terms as well as by the state in which you live.

A living trust can be established in several ways. You can leave your assets to a trustee, who is the person who manages your property until it is passed along to heirs or distributed as you specified. It’s possible to create property sub-trusts, which serve as divisions that limit the individual control beneficiaries have over money. You can even add powers of attorney and health care directives to a trust document while you’re alive. This makes it possible for you to have complete control over your estate plan.

Medical Powers of Attorney: 

A medical power of attorney is a legal document that allows an individual to delegate specific health care decisions in the event that he is incapacitated. This type of document does not supersede a living will or any other form of advance directive, but it does allow an individual more flexibility than most advanced directives and allows him to avoid the hospital setting. A medical power of attorney also allows the individual to appoint a healthcare proxy and to appoint someone to the power of attorney who can make medical decisions in his or her name while they are still capable.

This allows the individual to ensure that any sort of medical treatment is administered according to his preferences, and it also avoids expensive and time-consuming alternatives. A healthcare proxy can be established in addition to a living will. However, other legal documents will dictate how a person’s health care proceeds if he becomes incapacitated.

Durable Power of Attorney: 

A durable power of attorney is a legal document that allows an individual to delegate specific authority over his or her financial and legal affairs. The powers given to the individual are in addition to those that are usually granted by a durable power of attorney document. A durable power of attorney also permits the individual to appoint someone as guardian, who can make financial decisions for the individual when he or she is unable to do so.

A guardian cannot make decisions for the incapacitated person in all cases. For example, he may be unable to protect the individual’s assets from creditors. However, a guardian can make financial decisions and has the authority to access your bank account, even if you are incapacitated. Other legal documents can supersede a durable power of attorney in addition to a power of attorney itself.

Final Thoughts: 

It’s never too early to begin planning for your future and estate, particularly if you have a family. Without the proper legal documents, assets may not be distributed in the way you would like them to be, or other necessary steps may not be taken. A professional will give you options that aren’t available to individuals who try to do it themselves. For example, a trust can ensure that your personal information is kept private during its administration and that it’s not given away in the court system.