3 Focus Areas for Estate Planning In Montgomery County

If you are estate planning in Montgomery County, there’s plenty to think about. Through the estate planning process, you and your attorney will arrange for the management of your entire estate—financial assets, real estate properties, outstanding debts, and more—in the event that you pass away or become physically or mentally incapacitated. 

While planning, your three major focal points will be:

Setting Up A Will

A will is an essential part of most estate plans, and it is generally recommended that all individuals set up a will to avoid familial conflicts after you pass away.

Understanding A Will

In drafting a will, you direct how your property should be distributed by an executor. The executor is responsible for:

  • Collecting your estate assets (including investments, savings, your house, and other items of value)
  • Paying your estate debts (such as your outstanding mortgage, car payments, student loan debt, credit card debt, and other financial obligations)
  • Making distributions to the beneficiaries designated in your will

Determining the Executor For Your Will

It is often advisable to choose one executor as the personal representative of your will. You may then choose to have one alternate executor who may serve if your original executor passes away or becomes unable to properly execute your will. 

You are also allowed to designate two co-executors to execute your will together. However, these co-executors may disagree on certain actions, which may delay estate administration. If you decide to designate co-executors, they should be capable of working well together as a team.

Updating Your Will

You should regularly review and revise your will. A good rule-of-thumb is to review it at least every five years. While reviewing, ask yourself:

  • Do I understand what this says?
  • Do I agree with what it says?
  • Have my circumstances changed since this will was last updated?

Talk to your attorney if you must make changes. You should update your will if marriage, death, divorce, birth, asset growth, moving, estate tax laws, or other changes have disrupted the original objectives of your will.

Storing Your Will

Because your will is an incredibly important document, you should store it in a safe, secure place, such as:

  • A locked, fireproof box. 
  • A safe deposit box at the bank.

If you have a safe deposit box in Montgomery County or anywhere else in Pennsylvania, your bank must follow strict rules on who has access to it. If you have a spouse whose name is also on the safe deposit box, he or she may access the box after your death. However, individuals who are not listed as owners of the safe deposit box must present a death certificate to access your will within the safe deposit box. 

Setting Up A Trust

Your attorney may recommend setting up a trust, especially if you have a large estate, an estate with young beneficiaries, or other special circumstances. 

Understanding A Trust

A trust is a document that allows you to protect your property and assets via a trustee who controls and distributes assets to beneficiaries according to predetermined time frames and proportions. 

Example of a Trust

To help explain what a trust looks like, here’s an example: A grandparent decides to set aside funds to support their handicapped grandchild without disrupting the child’s government benefits, such as Medicaid and Supplemental Security Income (SSI) payments. A trustee may then invest, safeguard, and distribute the funds on behalf of the child according to the grandparent’s wishes. 

Logistics of a Trust

Trusts generally cost more than a will to create because they are complicated documents that must be customized to your exact situation. In addition to the costs of drafting the trust, you may also pay for:

  • continuing attorney fees for as many years as the trust is administered
  • trustee commissions for as many years as the trust is administered
  • accountant fees for as many years as the trust is administered

Factoring these administrative costs into your trust is essential to preventing long-term problems. 

Setting Up A Power of Attorney

A power of attorney (POA) is an important estate planning document for everyone to have, not just senior citizens and individuals who are sick. 

Understanding A Power of Attorney

A POA is a document that designates an agent to act on your behalf if you become unable to advocate for yourself. They are most commonly used when an individual is physically or mentally disabled and no longer capable of conducting their business independently.

There are two common types of POAs: A financial POA and a healthcare POA. If you’d like, you may choose a different agent for your financial and healthcare affairs. However, you may also choose a general durable power of attorney, which would give one agent the ability to take any action you would otherwise be able to make yourself.  

Financial POA

A financial power of attorney has broad powers to manage your finances and property. If you become sick or are otherwise unable to manage your finances, a financial POAz may:

  • Manage your family’s expenses
  • Pay your bills
  • Invest your money
  • Oversee your insurance accounts
  • Oversee your retirement accounts
  • Make bank deposits or withdrawals on your behalf
  • Manage your business (if you are a business owner)
  • Manage your real estate property

Throughout Pennsylvania, including Montgomery County, the financial Power of Attorney form requires a “notice page” and an “agent’s acknowledgement page” that detail exactly what an agent is capable of performing. 

These new forms became active on January 1, 2015. If you set up a power of attorney before 2015, it is generally recommended to update your forms.

Healthcare POA

A healthcare power of attorney appoints an agent to assist in determining appropriate medical care for you. If you so choose, your healthcare POA can:

  • Authorize your admission into a medical facility, nursing facility, residential facility, or a similar facility
  • Execute consent or admission forms for such facilities
  • Consent on your behalf for medical, therapeutic, and surgical procedures

Meet With A Montgomery County Estate Planning Attorney

Navigating estate planning should be completed with the assistance of a qualified estate planning attorney. Contact us for assistance! 

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