An estate plan is a person’s program for the maintenance and distribution of assets, both during life and at death. Estate planning is the process of making an estate plan. The process, and the legal “instruments” representing separate components of the plan, are generally similar in Texas and all other states. There are, however, some deviations in the details, procedures, tax obligations and the terminology from state to state.
Every plan will likely include a simple will or a more complex one if circumstances dictate. If a married couple is doing the planning process together, they will generally make what is called reciprocal wills. These contain provisions for distribution of assets in the event that both spouses die within close proximity to each other.
Along with wills, powers of attorney are important. They are used to give an appointee the right to take care of the person’s financial affairs by being able to sign checks, conduct business in general, and sign legal documents in the person’s name. The power of attorney is generally used most often after the maker becomes disabled or incompetent mentally to handle his or her affairs.
Another legal instrument is the health care directive. These documents generally are used to give authority to someone on the individual’s behalf to make decisions for medical treatment and communicate with medical providers. They also include the classic living will, in which the individual gives instructions to medical providers regarding what to do with respect to life extension issues and the continuation or shutting off of life-sustaining machines and instruments.
Provisions regarding insurance, joint accounts, jointly held real estate and other assets must be included. Pertinent choices must be given to the estate planning attorney for inclusion in legal instruments where appropriate. This includes deciding whether living trusts and/or testamentary trusts are needed. This is only a summary look at the multi-faceted estate planning process applicable to Texas and other states. The planning procedures must be focused on collecting and organizing all of the information that will be needed to develop a strong plan that follows perfectly the wishes of the maker.
Source: myrtlebeachonline.com, “Real Life | The documents you need to know about for feel-good estate planning”, Gary Newman, July 12, 2014