If you haven’t done so before, this is the time to put a plan in place ensuring that your assets will benefit those you care about. Beneficiary designations on insurance and retirement accounts should be reviewed, along with any existing Wills and Trusts you may have in place. Owning assets with your spouse or a different person should be carefully evaluated. There may be unintended consequences in joint ownership of real estate, bank or investment accounts, and other assets. Estate planning may include planning to minimize taxes, but often family considerations and needs are more important. This is also a good time to make sure you have plans and documents in place to enable others to help you in future years if the need arises.
An attorney should create the appropriate legal documents to assure your plan is formalized appropriately. There are others you may want to include in your planning such as your tax advisors who may give valuable insight about your tax status to your attorney.
Your F&M Trust relationship manager can assist you to prepare for the meetings with your other advisors, by helping you gather important information and discuss personal matters important to your estate plan decisions.
Your will directs the distribution of your assets to beneficiaries you determine after your death. A will also is used for you to identify your preference to serve as guardian of your minor children, who generally is the person who will raise your child in your absence. Wills do not direct the distribution of any life insurance or financial accounts when you have previously signed beneficiary forms and those beneficiaries are alive at your death. In that instance, the beneficiary designation directs the distribution of those assets.
Your will also names the person or financial institution to serve as executor of your estate. Your executor is tasked with wrapping up all the financial details of your life, such as gathering your assets, paying your final bills, selling your home and distributing the remaining assets to your beneficiaries. The estate settlement staff at F&M Trust serves in the important role of executor for many of our customers.
By signing a Power of Attorney, you give another person or financial institution the legal authority and responsibility to take specific actions on your behalf. Typically a power of attorney is written to assure that someone can take care of your personal affairs if you are no longer able to do so yourself. If your power of attorney is “durable” it remains in force if you are incapacitated and unable to make decisions for yourself.
There are two kinds of durable powers of attorney, one for finances, and one for health care decisions. Both are very important, but the person's given the powers might be different. A family member or close friend may be the best person to make healthcare decisions for you, but you may want an independent party such as F&M Trust to make financial decisions for you under a financial power of attorney.
An advanced medical directive allows you to specify your wishes for medical care to give guidance to your family and medical power of attorney if you are unable to make or communicate those decisions in the future.
Trusts are important legal documents that require a trustee, such as F&M Trust, to hold certain assets on behalf of yourself or others, including charities of your choice. The trustee must manage the assets and make distributions according to the terms you establish in the trust, acting only in the best interests of the trust beneficiaries. Trusts are fully customizable to your needs and desires, and therefore must be drafted by your attorney. The benefits of trusts are numerous, and include allowing you to control your wealth during your life and afterward, protecting your family and your legacy, and significant privacy benefits. There are also significant technical tax planning opportunities utilizing trusts.
Our F&M Trust relationship managers are available to discuss how a trust may enhance your estate plan and how F&M Trust can serve as trustee for you.
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