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Estate Planning Is A Collaborative Process

Estate Planning Is A Collaborative Process

Under Arizona Law if a person dies intestate—without a Will or Trust—his or her property will pass according to ARS 14-2101, et.seq. Currently this means that a surviving spouse will often inherit everything. If there is no surviving spouse, then the estate passes to children or grandchildren. If there are no descendants, then it gets complicated with the estate passing up a generation to parents and then down to descendants of parents, your siblings, or their children.

It gets additionally complicated if yours is a blended family with children not common to both spouses. In such a case half the decedent’s estate passes to the surviving spouse and half to the decedent’s children that are not also the children of the surviving spouse. This situation can be additionally complicated where real property is owned in Joint Tenancy or Community Property with right of survivorship, where there are payable on death accounts, beneficiary deeds or where the beneficiary designations for life insurance policies, IRAs and 401Ks are not current. Sometimes Arizona’s Intestate Succession law works adequately. Often it allows a result that was clearly not intended. Sometimes it works an extreme hardship.

There is no substitute for advance planning. Providing for the inheritance and care of the people who survive you is of prime importance. Equally important is providing for your own welfare during your lifetime. Some important issues to address in an estate plan are:

  • Who will make financial and medical decisions if you are incapacitated?
  • How do you want your money and property managed should you be unable to do this yourself?
  • Do you have end of life wishes? If so, have you expressed them in a written document? Is a DNR appropriate? Or do you want all possible care to prolong life?

Another important matter is legacy planning. This is not just money and property. It also can include communication of your values, hopes, and dreams for the family and loved ones that you leave behind. For many survivors, this last communication has more value than the estate itself.

Many decisions need to be made. Your Estate Planning Attorney can help. But, depending upon your circumstances, the help of a financial advisor, Insurance Agent, CPA, and Spiritual Advisor may also be needed. Although not always possible, having a frank and open discussion of your plans and goals with family members can sometimes help.

You will need to determine your goals. Is probate avoidance your primary goal? If so, this might be achieved through a combination of beneficiary deeds, payable on death accounts and updated beneficiary designations on your IRA, 401K and Insurance Policies. But these devices do not protect your family members from creditors, predators, divorcing spouses or from their own poor money judgment.

Often, more is needed. Some common circumstances that require more planning are for:

  • Parents with minor children who will need education, designation of a guardian and, perhaps should have money reserved in Trust, used for education and healthcare and then disbursed for graduation, marriage, a first home or starting a business.
  • Parents with adult children who are not good money managers. Here it can be important to preserve assets, control the use of funds and protect the child from the child’s own decisions and his or her creditors.
  • Parents in blended families who want to provide for all children equally or, in many cases, to provide for a surviving spouse but make sure the children of the deceased spouse receive a share of the decedent’s estate. Lack of proper estate planning can disinherit the children of the first spouse to die.
  • Parents with special needs children where it is important to provide lifetime care but not forfeit such government benefits as are being received.
  • Persons who have family members or others who depend upon them for support and/or care.
  • Persons who are business owners where succession planning may be important. A decision is needed as to what will happen to the business. Should it be sold? Can it survive the death of the parents and, if so, who will run the business. If one child receives the business, how will other children be treated? Is equal treatment of the children important?
  • Persons who are recently divorced or widowed should update existing estate plans or create new estate and financial plans that make sense considering the new circumstances.

The goal is to make sure your wishes are clearly expressed while making the job of administering your estate, both before and after death, easier for your children or others chosen by you. A well thought out estate plan can be key to avoiding family conflict after a death.

Planning for the future in this way is complicated and can be overwhelming. That is why estate planning is often avoided until it is too late to plan—after a death or debilitating accident or illness. A good way to get started and simplify the process is to meet with an Estate Planning attorney. He or she will listen to your goals and concerns, refer you to other professionals if needed, suggest options and will provide a plan that meets your lifetime needs, contributes to family harmony and protects your family when you are no longer able to care for them yourself.

If you have questions about estate planning you may schedule a complimentary conference with one of our experienced lawyers by filling out the form below or contacting any of our staff at 602-277-4441.

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