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Hillside, IL 60162

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Posted on in Estate Planning
estate-planning-question

Q. I am not very wealthy. Why do I need estate planning?

A. Estate planning is for everyone. Your estate plan may cover a lot of issues other than just money. If you want to designate the guardian of your children, you need an estate plan. Even if your savings or wealth are modest, an estate plan lets you decide who will receive your property when you die. For many people, their estate plan also addresses matters like old age, disability and illness.

Posted on in Estate Planning
benefits-of-preparing-a-will

Most people know that a will lets them determine who will receive their property when they die. Despite this significant benefit, relatively few people have wills.

If you die without a will, your property will be distributed according to state law. It may not be distributed the way you want, since it is distributed without considering the needs or circumstances of recipients.

A will can do more than just determine how property is distributed upon death. It can name an executor. The executor will oversee your estate's financial affairs during "probate," including making sure your debts are paid and that your property is distributed as stated in your will. Without a will, a judge chooses your executor.

A will can also set up a trust, which can help save taxes. Thus, for people with substantial assets (like a home), a will can be a cost-saving tool.

For married couples with young children, wills are essential. Each spouse should have a will in order to select a guardian for the children in case both parents die. The guardian will raise the children and manage their money. Without a will, the critical decision of who will be your children's guardian will be left to a judge.

Updating Your Will

It is a good idea to review your will with your lawyer every two to three years to make sure that it is up-to-date with your current family circumstances and tax laws. In addition, it is especially important to review and update your will when:

  • there is a birth or death in your family
  • your financial situation changes significantly
  • you want to name a new guardian or executor
  • you want to change how your property will be distributed
  • you marry or divorce
  • you move to a new state.

Seek legal help in making or changing your will. Laws for making and changing wills are specific, and you will want to be sure everything is done right. Also, your lawyer can explain how estate taxes affect you and help you make a will that may reduce your taxes and leave more to your family.

Posted on in Estate Planning
avoid-probate-with-a-living-trust

Anyone who thinks about planning his or her estate will hear about "wills," "probate" and "living trusts." A will is a document that states where you want your property to go when you die. Probate is the court procedure that makes sure your will is valid and puts it into effect. But what is a "living trust?" To answer this, you need to know a little about "trusts" in general.

Trust are legal devices that let one person "own" property for the benefit of someone else. With a trust, a person can stop being the "owner" of property while still keeping control over it. A trust is created when someone (a "trustee") agrees to hold and manage property for the benefit of someone else, who may later get the property, or the income or benefits it generates. The person who receives these benefits is the "beneficiary."

A living trust is a special kind of trust which has many estate planning benefits. In a living trust, you can transfer property from yourself (as the full owner) to yourself in a new capacity, as "trustee." After this transfer, you still control the property. You receive the benefits of ownership while you are alive. When you die, a "successor" trustee (someone you selected) distributes the property to the people you chose. This takes place without the involvement of the probate court.

A living trust is created by a written trust document, written with a lawyer's help. Your lawyer can also help prepare other papers used to transfer property into the trust. You can place almost any type of property in it, including money, real estate, stocks, bonds and automobiles.

Use of living trusts has grown because for many people, they offer significant benefits. Here are some of the main ones.

  • Avoid delays and expense of probate. With a living trust, property can often be transferred after death much faster than by will, since property left by a will has to go through the probate process. Also, the steps to be taken under a living trust can be less expensive than administering a will. So a living trust can avoid delays and expenses of the probate process.
  • Privacy. Living trusts offer a lot more privacy than wills because wills must be proved and administered through courts, and court records are open to the public. The contents of a living trust don't have to be made public, so they are easier to keep confidential.
  • Lower estate taxes. Depending on the value of your estate, a living trust can help to lower the estate taxes due on your death.
  • Flexibility. A living trust can be changed or revoked if you are not satisfied with how it is working.
  • Control. A living trust can let you make decisions about how you will be cared for in old age. For example, you can say that trust income will be used to help your family take care of you. Without a trust, if you become unable to care for yourself, a court may have to decide who will take care of you and manage your money.
  • Hard to challenge. Another important benefit is that living trusts are usually harder to challenge than wills.

Whether a living trust is the best estate planning tool for you depends on several factors, including your financial situation and potential tax liability. Your lawyer can help you achieve your estate planning goals so that your property goes to your loved ones in the fastest and least-costly manner.

advance-directives-deciding-your-medical-care-before-a-serious-illness

Who will make medical decisions for you if you become so ill that you cannot communicate your wishes? What if the person selected chooses treatment you would not want? Fortunately, there are documents - called "advance directives" - you can prepare before a serious illness to help in situations like these.

An "advance directive" is a document that tells how you want medical decisions made if you ever become physically or mentally unable to make them yourself. The two most commonly prepared advance directives are a "living will" and a "durable power of attorney for health care." Here is a brief explanation of each.

  • Living Will. A living will lets you specify the types of life-prolonging treatment you want - or do not want - in the event you were terminally ill. It is called a living will because it can take effect while you are alive.
  • Durable Power of Attorney for Health Care. This lets you appoint someone (such as your spouse or child) to make your medical decisions if you cannot make them yourself..

Which is Better?

In some states, laws may make it better to have one or the other. In other states, it may be possible to have both, or to combine them in one document that describes the treatment you want in different situations and names someone to make medical decisions for you if you cannot.

If you prepare an advance directive, you can change or cancel it any time. To be valid, any change or cancellation must be made according to state law.

The worst time to try to find out a person's wishes is during a medical crisis. So it is best to prepare an advance directive as soon as possible. The advance directive will help make sure you get the medical treatment you want if you are unable to communicate your wishes. For more information about advance directives and help in preparing them, contact your lawyer.

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