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sara

Estate planning deals with organizing the estate for disposing it off to the heirs. If you plan your estate in a proper way, it will help your heirs avoid probate. Also, you'll be able to increase the value of the estate by lowering taxes and other expenses. Check out some of the tools which will help you in planning for your estate in a suitable way:

Living Trust: One of the common ways for estate planning is to arrange for a living trust. It is a contract which will hold the title and control the assets. These trusts are mainly designed to avoid probate. It will also help you in protecting your financial privacy, reduce taxes and regulate the use of assets when you (the original owner) become incapacitated. A living trust comes into effect when you execute it and transfer assets to it.

Will: It is a document wherein you can inform your heirs as what you'd like to do with your assets upon your death. One of the major differences between a will and a living trust is that a will comes into effect after the death of the grantor whereas a living trust comes into effect during his/her lifetime. Any person who has attained the age of majority and is of sound mind can draft his/her own will with or without the help of an attorney.

Living will: It is a legal document which will help you in declaring your wishes when you face life-sustaining medical treatment. This technique is also known as an advance directive, physician's directive or health care directive. You can contact your real estate attorney and he may help you in drafting your living will.

Durable power of attorney: In some states, durable power of attorney is also known as health care power of attorney. This document authorizes your agent/attorney to make health care decisions on your behalf. Thus, the attorney can make decisions like terminating health care facilities, give consent to or withdraw consent to any medical treatment or service, etc.

Durable power of attorney differs from a living will because it appoints another person to take health care decisions on your behalf. In New York State, a Health Care Proxy law has been enacted where the grantor should arrange for a separate document appointing a person as his/her health care agent.

Niicss · Posted: Thu Dec 17, 2009 3:51 am Post subject:

You've suggested some great ways for managing one's estate, Sara. I would like to add 2 more ways to go ahead with planning one's estate:

Life insurance – Your family can receive lump sum cash as death benefit if you've a life insurance policy. This can be used by your heirs to pay off your debts. A life insurance policy will also help you in distributing your property in a better way to your heirs. For example, if you've two heirs, you can give your house to one of them and the life insurance death benefit to the other. Also, your life insurance death benefit can be used to pay the expenses associated with your estate.

Prenuptial agreement – It is better to go for a prenuptial agreement or a prenup before your marriage if you've major personal assets. Prenup would include provisions for property division, spousal support after divorce, forfeiture of assets during divorce, etc. This agreement should be in writing and executed voluntarily by both the spouses.

jameshogg · Posted: Thu Dec 17, 2009 8:41 pm Post subject:

A business succession plan can also be a great way for business owners to plan their estate. The business succession plan will help the business owner to create a transfer arrangement to his heir who works in the business and will also compensate those heirs who don't work in the same business. This will make sure that those heirs who are not a part of the business will not be left out.

A Health Insurance Portability and Accountability Act (HIPAA) release is also a way to plan your estate. This release will help you in appointing a representative. The medical professionals looking after your health will discuss your medical condition with this representative. As the Federal law has imposed privacy requirements on health professionals, they won't disclose your medical information to any other person who is not designated as your HIPAA representative. Thus, you should make sure that you have a HIPAA representative who can take decisions on your behalf if you're ill.

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How to transfer property to your heirs