Tools Available to Plan Your Estate

For anyone considering estate planning, we offer several documents to accomplish common goals of the estate. The information below provides explanations of each of our estate planning documents. For a free consultation about these documents and other common estate planning tools, contact us at (623)551-9366.

WILL: AKA “Last Will and Testament.” The will or simple will is the document that allows a person (referred to as the testator/trix) to choose where his or her assets go upon your death. The will allows parents of minor children to appoint a guardian and trustee for those children if he or she in the event that he or she were to pre-decease the child. Other perks of the will allow the testator/trix to appoint a personal representative (also called an executor/trix), who is the person who takes the will to the court and makes sure the estate is probated properly. The will allows the personal representative to avoid paying a bond, which he or she may have to pay absent a will. The will also allows a testator/trix to appoint the personal representative to sue on behalf of your estate if, for example, you are killed in a car accident or by someone else’s negligence.

Our wills include testamentary trusts for minor beneficiaries. Through our wills, a testamentary trust is set up for minor beneficiaries if the testator/trix dies while his or her children are still minors. The testator/trix is able to choose an age (typically 18, 21, or 25) for his or her child to receive a full disbursement of his or her share of the estate. Until reaching such an age, a trustee is appointed and can provide money from the trust for the child’s food, shelter, education, and standard of living. Even if the testator/trix’s children are full grown, this provision would apply to any minor beneficiary (for example, if the testator’s son predeceased the testator, then the testator’s grandchildren may receive as minor beneficiaries under the will).

If a person has a will from a different state, we recommend he or she draft a new will in Arizona to replace the existing will. Each state has its own estate laws. Many states use different nomenclature (executor instead of personal representative, for example) and have different laws of succession of an estate if the beneficiaries have passed. We encourage people who live in Arizona to have wills drafted in accordance with Arizona laws to make sure a judge enforces the terms of the will properly as the decedent planned.

If the testator/trix wants to leave specific personal belongings to a person other than the beneficiaries of the estate, we offer a form with our wills that the testator/trix can fill out and change as he or she wishes without having to redraft a whole new will. (For example, if I wanted to leave a necklace to my sister, but in my will I wanted to leave everything to my spouse, and my daughter if my spouse predeceases me, I could write the necklace on this sheet of paper. If my sister upsets me and I instead wanted to leave the necklace to my friend, I can simply tear up the original page and write on a piece of notebook paper that I want to leave the necklace to my friend, without drafting a whole new will.)

LIVING WILL: AKA an “advanced directive,” this document is designed to allow a person to state his or her intentions for end of life treatments. This document grants the person the ability to turn down food, fluids, artificial resuscitation, electro-shock, medication (outside of comfort care AKA morphine), and to be taken to a hospital if at all avoidable. Most hospitals and medical care facilities will require a patient to have this document prior to any major surgery/procedure. This document is incredibly important. If you remember the Terry Schiavo case in FL, a woman’s parents and her husband were fighting over whether to stop her feeding tube in order to end her life when she was in an irreversible coma at a young age. If she had a living will, she would have been the one who made that decision, instead her family ended up fighting a long, draining legal battle through the Florida court system.

Hospitals will often offer to provide this document to a person prior to admitting him or her to the hospital if the person does not already have one. We encourage everyone to have his or her own drawn up with an attorney instead of using the hospital’s living will. The hospital forms are incredibly broad, and do not always reflect the best interests of the patient. The hospital’s competing goal may be to stop offering treatment once the patient no longer had the money to afford it.

Our living wills are designed to allow the person to make his or her own choice about life-sustaining treatment. He or she can choose whether to affirmatively turn down each life-sustaining measure including (a) cardiopulminary shock, CPR; (b) food/fluids; (c) medication outside of comfort care; and (d) to be taken to the hospital if avoidable. The client can choose this option in the instance that he or she is in a persistent vegetative state or otherwise in a terminal condition with no chance for recovery as determined by doctors. This document not only allows them to make these important decisions, but it takes away the burden from family members having to make this decision or, heaven forbid, fight over this decision.

HEALTHCARE POWER OF ATTORNEY: AKA “Healthcare Proxy.” This document allows the person to appoint an agent to make healthcare decisions on his or her behalf if he or she is unable to do so. The healthcare decisions must be in accordance with what the person’s wishes would be. This document serves as a “catch-all” for all other instances outside of the living will where health decisions need to be made but the principal is unable to communicate such decisions. Our healthcare power of attorney document includes HIPPA language, which allows the healthcare agent access to the principal’s medical documents. Many older healthcare power of attorney documents do not have this language, and if they do not contain it, then we recommend the client executing new documents with us to include such language. This document may come into play, for example, if someone is in an accident and temporarily sedated. If a healthcare decision needs to be made, then this document allows that person to appoint an agent to make those decisions.

BUSINESS POWER OF ATTORNEY: AKA “General Durable Power of Attorney,” “Financial Power of Attorney,” “Power of Attorney for Property.” This document allows the principal to appoint an agent and alternate agent to conduct any financial affairs on his or her behalf. This document is broad, and allows the agent access to bank accounts, to mortgage a house, to fund a trust, to access a security deposit box, and to fund nursing home/end of life care. The agent has a fiduciary obligation to act in the best interests of the principal. This document is important because when people are temporarily incapacitated, or even when, for example, they’re out of the country and can’t sign a check but forgot to pay a bill, then the agent can sign on their behalf to pay their bills. People are often hesitant to sign over such power when it comes to finances, but they need to understand that it is better to sign over this power when you can choose the agent, than to have someone petition the court to do so against your will.

In Arizona anyone can petition a court to be someone’s fiduciary/agent. This document and the other two power of attorney documents allow the person to appoint someone he or she knows and trusts to make these important decisions so that someone else does not. There have been countless stories in the Arizona Republic of people abusing this power and draining their estates because the party was appointed as the agent due to a lack of an agent being appointed.

MENTAL HEALTHCARE POWER OF ATTORNEY: Our newest offered estate planning document. This document allows the principal to appoint an agent and an alternate agent to make decisions regarding the person’s mental healthcare. Specifically, this document allows an agent of the principal’s choosing to (a) have access to mental health docs; (b) give consent to take medications; and (c) admit the principal to a behavioral health facility if necessary. This document is much more limited than the other documents for the reason that once the principal is no longer deemed competent, the document becomes irrevocable. The reason this document becomes irrevocable is because if a person doesn’t have the mental health to determine what is in his or her own best interests (taking heart medication because he or she irrationally believes it is poison, for example) then the agent is entrusted to make these decisions on the principal’s behalf.

BENEFICIARY DEED: This document allows real property to pass automatically upon a person’s death, rather than going through probate. This document has the same effect as if the property passed through a trust, but without the expense and complication a trust necessarily involves. If a person owns a home in his or her name as sole owner, then he or she simply names the beneficiary of his or her choosing to take title to home automatically upon his or her death.

TRUST: AKA “[Ir]revocable Living Trust.” This document is much more complex than the other estate planning tools. This document is useful if the person has over $5.12mil in assets, if the person owns property in different states, if the person has a blended marriage, or for people who really just want to make sure their assets pass automatically upon death instead of going through probate. Even with this document, people will still need wills, called spillover wills or pour over wills, which designate any property that was not in the name of the trust upon the decedent’s passing to go into the trust.


2 Responses to “Tools Available to Plan Your Estate”

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