Moore Law Firm

Moore Law Firm

9949 W. Bell Road
Suite 201
Sun City, AZ 85351
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Sun City Estate Planning Blog

Estate planning for Millennials

Believe it or not, Millennials are now legal adults. This means that they, too, are dealing with the common financial decisions that face most Americans. However, given their unique position in the world, Millennials face some different challenges that may make it more difficult for them to plan for the future. While this certainly holds true for retirement, it also pertains to estate planning.

Many Millennials have delayed marrying, buying homes, and having children, and their student loan debt is higher than their predecessors. These facts may leave some Millennials feeling like they don't need to engage in estate planning, but nothing could be further from the truth. The fact of the matter is that there are estate planning tactics that can meet every situation, including those faced by Millennials.

Some things to consider when administering an estate

Dealing with the loss of a loved one is challenging to say the least. Many individuals find the emotional turmoil overwhelming without even having to deal with other issues. Unfortunately, many people have to deal with their lost loved one's estate, which can complicate matters further.

Although some family members have to sit back and accept their inheritance, others carry a greater responsibility, such as when they must act as an estate administrator. This administrator is typically named a will, but he or she may be appointed by the probate court if a will doesn't name an administrator. As administrator, Sun City residents are responsible for identifying and gathering the estate's assets, paying the estate's bills, distributing assets to named heirs, and even filing the estate's taxes.

Trustees and the fiduciary duty

Serving as the administrator of a trust, also known as a trustee, can be a great honor. In many instances, an individual has named another person in his or her will to serve as the administrator of a trust because he or she trusted the sound judgment of the named person. As much of an honor the title may seem, there are significant responsibilities that come with it. Both trustee and trust beneficiaries need to know about these duties so that they can ensure that the trustee acts in accordance with the law.

At the heart of trust administration is the fiduciary duty. In short, a fiduciary is an individual who must act in the best interests and for the benefit of another. In the case of a trust, the trustee must make all decisions for the benefit of trust beneficiaries. This can be overwhelming to some trustees. After all, they may be responsible for investing trust assets and/or distributing them in accordance with the trust's terms.

Our Sun City firm is adept at utilizing trusts

If you find yourself hesitating to take the plunge into estate planning, you're not alone. Many Arizonans procrastinate when dealing with their estate, and for a variety of reasons. Some are afraid to confront their own mortality, while others are simply overwhelmed with the idea of accounting for their assets and deciding how they should be distributed upon their death. Regardless of why you've been putting off estate planning, it's never too late to start. By working with an estate planning attorney, you may find the process easier than you thought and your mind will likely be put at ease knowing that your assets and your loved ones are taken care of.

Of course, there are a number of ways to go about estate planning. Some people only want to utilize a simple trust, while others see a need for revocable trusts and other trust types, such as the charitable trust. What's key to remember here is that you have control of your assets and the estate planning process. Therefore, your estate plan can be custom-tailored to fit your needs.

Three key components to effective estate planning

Estate planning can be an intricate process. Depending on the circumstances, numerous legal documents may need to be drafted, and the language in key provisions can be critical to their interpretation. Therefore, a lot of care needs to go into the drafting of these documents with three major components in mind: communication, clarity, and customization.

Communication is often key to effective estate planning. Far too often, individuals put off talking about their estate plans with their attorneys and their loved ones. This is the only way to head off unforeseen complications and ensure that loved ones understand your estate planning intentions. Of course, every family is different, so exactly how these matters are handled will vary based on familial dynamics.

Revoking a power of attorney

As you likely know, there are dozens of legal and financial decisions to make over the course of a lifetime. If you are healthy and mentally fit, making your own decisions probably makes sense. Of course, it is not hard to imagine a scenario in which you may be incapable of choosing what is best for you and your finances. 

With a power of attorney, you name someone who can make financial, legal and other decisions on your behalf. Still, for any number of reasons, you may no longer have confidence in the person you designated. As such, revoking your POA may be vital for protecting your interests. If you plan to revoke one, though, you should keep a few things in mind. 

A pour-over will can be an efficient estate planning tool

Readers of this blog might be aware of the numerous estate planning tools they have at their disposal. Many Arizonans choose to utilize a living trust as part of their estate plan as it allows assets to bypass the probate process. One of these trusts can also give a testator a certain amount of control over those assets, thereby allowing him or her to dictate the terms associated with release of trust assets. Yet, in order for a living will to be effective it must be constantly updated. Those who fail to put all of their assets into this trust may wind up having those assets subject to a distribution that is not in accordance with their wishes.

This is why many individuals choose to create what is referred to as a pour-over will. This type of will specifies that all assets owned by the testator are to be transferred to a living trust upon his or her death. This is an effective and efficient way to manage one's estate because he or she doesn't have to constantly revisit the trust to ensure that it contains all of his or her assets. It can also help ensure privacy since the specifics of living trusts are kept from the public eye.

Wills and the letter of instruction

Creating a will is a strong first step when it comes to estate planning. This document, even in its most basic terms, can be a powerful way to ensure that one's estate is appropriately addressed after his or her death. When a will isn't created, the distribution of one's assets is handled in accordance with state law, which may not coincide with an individual's wishes. This can lead to a lengthy and highly contested process that oftentimes pits family members against each other. This is one of the many reasons why Arizonans need to make sure their wills are clear and thorough.

There is another way to lend clarity to a will: by providing a letter of instructions. Although these document isn't legal in nature, it can help address certain matters that are left untouched by a will, thereby ensuring that the estate administration process proceeds as smoothly as possible.

A primer on the revocable trust

There are many estate planning legal documents that an Arizonan can utilize to ensure that his or her assets are handled in accordance with his or her wishes. For some, this means creating a simple will. For others, more extensive planning is needed. One of a variety of trusts can help place restrictions on asset distribution and provide tax benefits, which is often a major draw for estate planners.

One type of trust that is common in estate planning is the revocable trust. As it's name implies, this is an entity that can be revoked at any time. Some compare the revocable trust to an open bag, where assets can be placed into the "bag" and then removed at will. Upon death, though, the bag is sealed and any assets remaining inside the trust will become subject to its terms.

What is the ancillary probate process?

The way in which estate plans are created and estate assets are distributed are dictated by state laws. Therefore, those who are familiar with their state's laws can usually craft an estate plan that suits their needs. In some instances, though, these matters can be complicated, particularly if an individual owns property in different states.

Generally speaking, the assets of an estate must go through probate before they can be distributed to heirs and beneficiaries. There are some exceptions, such as transfer on death accounts and assets that are placed in particular types of trusts. But when an individual owns assets in multiple states, then those assets are subject to the probate laws of that state. Therefore, if an individual lives and dies in Arizona, but owns property in Arizona and New Mexico, then the main estate will be probated in Arizona and an ancillary probate process will be initiated in New Mexico.

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Moore Law Firm
9949 W. Bell Road
Suite 201
Sun City, AZ 85351

Phone: 623-207-9153
Phone: 623-207-9153
Fax: 623-977-7237
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