Estate Planning and Conservation, Black’s Law Dictionary, First Edition 1891, defined ‘Estate’ in part as: “The interest which any one has in lands, or in any other subject of property… The word ‘estate’ …comprehends every species of property, real, and personal…” Decades later the Fifth Edition added, ‘…The total property of whatever kind that is owned by a decedent (deceased; dead person) prior to the distribution of that property in accordance with the terms of a will, or, when there is no will, by the laws of inheritance in the state of domicile (permanent or principal residence) of the decedent.’ Thus, your estate includes your house and any other real estate; financial accounts and non-qualified investments; business interests; retirement benefits and accounts (IRAs, 401Ks, pensions; etc.); insurance policies (death benefit to individual beneficiaries can be received tax-free and excluded from deceased insured’s estate); vehicles; collectibles and other personal belongings.
Basic estate planning can be started by most people; however, due to the complexities of numerous laws and vast choices in financial and estate planning, most people with large estates (even more than $ 1,000,000 in assets) should consider the help of professionals. One or more of the following may be needed to get the results you desire: an accountant, attorney, bank trust officer, life insurance agent, and other consultants. “There is a common misconception that an estate is only the property that one leaves at death. In reality, it is much more than that. The term estate planning in its broadest sense encompasses the accumulation, conservation, and distribution of an estate. The overall purpose of the estate planning process is to develop a plan that will enhance and maintain the (household’s) financial security… include lifetime financial planning… and facilitate the intended and orderly disposition of property at death.”[i] The following include topics related to estate planning:
I. LIVING WILL:
A living will (advance medical directive) is a legal document used to communicate your desires concerning future medical treatment in the event you are not able to speak for yourself. The legal contract requirements vary by state; however, the general purpose is the same. Living wills specify which life prolonging treatments you do or do not want in the event you become terminally ill or enter into a vegetative state. The document should be given to at least two individuals who would be most likely to communicate your request. This directive is not effective until you are incapacitated and unable to communicate. Certification of your condition by a physician is usually required.
II. FUNERAL ARRANGEMENTS:
Personally, I tell my wife and kids, ‘when I die, my soul will fly, but you can put my body (t-shirt and jeans) in an online discount casket and bury it in the country near the old church; or nuke (cremate) it and cast my ashes in the Mediterranean Sea or Mississippi River if you don’t want me on your cruise.’ The truth of the matter is that dealing with the death and funeral arrangements of a loved one can be very stressful and difficult.
Many individuals do not consider or care to deal with helping their spouse, children, or siblings, by aiding in the planning for their own funeral. For many family members, your input concerning your final arrangements is often more important than the money needed for funeral expenses. Your opinion or desire as to burial or cremation, your final resting place, memorial service, costs and how to achieve the arrangements, and even help with your obituary, will help prepare your family, as well as relieve some future stress.
III. ASSETS:
One of the most important steps in estate planning is making an inventory of your assets. Seeing that you would probably rather give your money to other entities than the IRS, do not get to caught up in auditing your non-collectible books, clothing, CDs and DVDs, and other personal items. Reasonable garage sale prices on furniture, exercise equipment, and personal items are most practical.
