Nobody Dies Without An Estate Plan
About half of all people die without a Will or Trust, but nobody dies without an estate plan. Texas law determines who gets your property if you die without a Will or Trust. If that outcome makes you uneasy, then it’s time to do some estate planning of your own by contacting one or estate planning attorneys.
Estate Planning in San Antonio Doesn’t Have to Be Expensive
While estate planning doesn’t have to be expensive, it should always be thorough and thoughtful. Below is a description of the major phases involved in estate planning. The information is general in nature and intended only for educational purposes. A qualified attorney should be consulted before an estate plan is created. The Cramp Law Firm is here to help—whether your needs are basic or more complex.
Phase 1: Determine Estate Planning Objectives
A client’s objectives drive the entire estate planning process. Estate planning objectives are as diverse as the clients involved. The most basic objective involves planning the transfer of wealth and property after death. When minor children are involved, your plan should include designating who will care for the children’s person and property under a range of scenarios: (a) if both spouses are incapacitated or die simultaneously, and (b) if the sole surviving spouse becomes incapacitated or dies. At other times, objectives involve planning for the management and transfer of some wealth and property during life—with the remainder transferring after death. In today’s world with second marriages, planning to support a surviving spouse while ensuring children from a prior marriage share in your wealth often ranks high among client concerns. These are just a few examples from among the universe of concerns that shape client objectives.
Phase 2: Create, Coordinate & Refine Estate Plan Structures
Think of estate plan structures as related documents that have complementary purposes. Creating the right structures might involve a simple or complex Will and/or a Trust or family of Trusts. Trusts that operate during life generally should be complemented by a Pour-Over Will. A Pour-Over Will operates like a “catcher’s mitt.” At death, it transfers any property acquired very recently into a Trust. Without a Pour-Over Will, late additions to the estate might prove to be “outside your plan” and transfer according to the laws of Texas.
At death, ownership of significant property might pass by contract law, which operates
Many people don’t grasp this next point. All property owned or controlled at death remains part of your estate for calculating potential estate tax. This holds true whether the property passes by contract, Will, Trust, or the laws of Texas. The specter of estate tax might merit adjustments to estate plan structures in order to eliminate or mitigate tax exposure.
Finally, supporting documents such as a Power of Attorney, Advance Directive to Physicians, Guardianship Designations for self or minor children (alluded to earlier), and health information releases might be included in the estate plan structures.
Beyond reviewing and explaining the estate plan structures to the client, the Cramp Law Firm—with the client’s permission—will be glad to provide relevant structures to the client’s other advisors for review and input. Other advisors might include a professional Trustee such as a Bank or Trust Company, an accountant, an investment or wealth advisor, or favored charity. Coordination is an important step because it ensures everyone on the client’s team is on the same page in supporting the client’s objectives.
The outcome of coordination is refinement. All inputs received by the Cramp Law Firm are reviewed and explained to the client. Inputs approved by the client are marked for inclusion. Final estate plan documents are then prepared and executed.
Phase 3: Retitle & Realign Assets
Generally, this phase is not required if the client’s needs and objectives require only a Will. When Trusts are involved, however, assets such as homes, vehicles, checking and savings accounts, and other financial instruments (e.g. stocks, bonds, mutual funds, etc.) need to be retitled to reflect ownership by the Trust. Other assets that may not have separate title records, such as heirloom furniture and jewelry, need to be realigned to reflect Trust ownership as well. This typically occurs via
Phase 4: Execute and Administer the Estate Plan
When a Will is involved, an Executor’s duties commence upon the client’s death. Wills are not operative during the maker’s life. Please see this website’s section on Probate for more information.
Trusts become operative at creation. A Testamentary Trust is created in a Will so it only comes into being when the Will is probated. A Living Trust comes into being
Trustees normally conduct their business without a court’s supervision and outside of the probate process. Beyond regular management of Trust affairs, Trustees often provide an annual status report (an “accounting”) to beneficiaries until the Trust is dissolved.
Phase 5: Review and Update With Our Estate Planning Attorneys
Since change is part of life, all estate plans should undergo periodic review to ensure the plan continues to reflect the client’s objectives. Review can be triggered by major life events such as birth, death, marriage or inheritance. Otherwise, reviews can occur at regular intervals that fit the client’s comfort level such as every three-to-five years. The Cramp Law Firm will be glad to recommend and provide an appropriate level of review when requested by a client.