At Rock Solid Law, we believe Estate Planning is a celebration of all that you have achieved - your Legacy! We help you show your love to those you treasure. In this process, we acknowledge that some of the terminology is confusing. It seems some other professionals delight in making it as complicated as possible to position themselves as “knowledgeable”. We don’t roll that way! Here’s a key to what the words mean. All that really matters is that we help you build a plan that perfectly fits your goals.
We will do that with you!
Here’s your key to demystifying the terms for your plan:
•Will: A written direction controlling the disposition of property once you no longer need your property. This document advises everyone of who will care for your children, how you want your assets divided, who should be in charge of handling your estate, and other instructions for the handling of your affairs after you check into the afterlife hotel. A judge will make sure your wishes are carried out. A Will involves a Probate lawsuit, which many people wish to avoid.
•Revocable Trust: The way you can exert control over your worldly possessions even after you’re gone. Trusts are commonly used in addition to a Will to provide additional flexibility, privacy, and probate avoidance. Allows you to specify who will inherit your property after you pass away and allows you to fund your trust to avoid going through the expense and delay of probate. If you want, a Trust can provide an immediate inheritance to your loved ones (as opposed to the delay caused by probate when you have only a will), and maintain privacy (probate proceedings are public record). Also, a Revocable Trust can be used to provide beneficiaries with creditor or estate tax protection.
•Durable Power Of Attorney: This document appoints someone to assist in handling your financial and business affairs. This is particularly helpful to have in order to make sure that if you become incapacitated (can no longer manage your affairs) the financial and emotional expense of a guardianship proceeding can be avoided for you and your family. Having a POA in effect assists with paying your bills and protecting your assets in the event of your absence, illness, or incapacity.
• Designation of Health Care Surrogate: Allows you to appoint a person(s) who can speak with your doctor/health care provider and make medical decisions on your behalf if you are not able do so.
• Living Will: Allows you to specify your end-of-life care decisions with directions to your doctors and other health care providers as to the use of life-prolonging procedures in the event of a terminal illness or coma- type condition. You can control those difficult decisions according to your own beliefs and alleviate your loved ones from having to make some really hard choices for you. You appoint an enforcer who can instruct the doctors and health care facility as to your wishes. The Designation of Health Care Surrogate and Living Will are often referred to collectively as “Advanced Directives.”
•Wealth Preservation a/k/a Asset Protection - Wealth Preservation is the process of protecting your assets during your lifetime and preserving them for future generations. During your lifetime, the primary focus is on protecting your assets from unforeseen creditors such as a malpractice lawsuit or a lawsuit resulting from a car accident. For people who own businesses or rental property, it is especially important to minimize the risk that a liability resulting from the business or the rental property could lead to the seizure of other non-business assets.
When you meet with an attorney at Rock Solid Law regarding estate planning or business planning, we will be happy to discuss strategies for wealth preservation and asset protection with you.
During your lifetime, this may include strategies such as the following:
• Business Entities: Proper use of a Limited Liability Company, Corporation or Partnership in order to minimize business risks.
• Homestead Exemption: Making sure that you take advantage of Florida’s constitutional protection of homes.
• Tenancy by the Entireties: Married couples owning joint property can protect assets from individual creditors if the accounts are titled properly.
• Life Insurance, Annuities, Etc.: Many types of investments, such as annuities, are statutorily protected from creditors. We can help you analyze what assets are protected and which ones may be at risk.
Other Wealth Preservation strategies are also an important factor to consider as part of your estate plan, to make sure that your assets are not depleted after your death. With the right planning, you can make sure to leave your wealth to future generations in a manner that minimizes taxes and protects the legacy you leave to children or grandchildren from the risks of a lawsuit or divorce. It is also important to make sure that beneficiaries who may be young or irresponsible with money are not given control over their share of your wealth until or unless they can manage it responsibly and properly preserve it. After you pass away, trusts created by your Will or Trust, which we call testamentary trusts, can be used to accomplish these goals in the following way:
• Trusts for Minors: A responsible adult can manage money for a minor and use the money for the minor’s benefit until the minor is old enough to do so for themselves.
• Spendthrift Trusts: Can be used to make sure that money left to a child or grandchild will be protected from their creditors or an ex-spouse in divorce.
• Protective Trusts: Can be used when a beneficiary, even as an adult, is irresponsible or has problems with substance abuse so that a responsible third party can manage the money you leave them for their benefit.
• Dynasty Trusts: Generational trusts that protect assets from creditors and estate taxes for potentially hundreds of years into the future.