top of page
  • jennifergrantlaw

The four most important estate planning documents you should consider

When planning your estate, there are many things to take into consideration, such as who will handle your affairs, how your assets will be distributed, and your end-of-life arrangements. The death of a loved one is a sad and stressful time for family and friends, so preparing ahead of time can ease any added stress. We have broken down four of the most common types of estate planning tools that you should consider!

1. Will

A will is a very common way to distribute your assets upon death. A Will distributes any property that is in your name as of the date of your death. Even if you have done estate planning by designating pay-on-death beneficiaries on your bank accounts or re-naming assets in the name of a trust, you should still have a Will just in case an asset is left in your name upon your death. As such, a Will is one of the most important documents to ensure you have signed before death, as otherwise, your estate assets will pass according to Florida intestate statutes. If that happens, your assets may not pass as you’d like, especially if you have strained relationships with family members or you’d like to gift different amounts to different family members.

A Will allows you to pick which assets go where, to whom, and the amounts. A Will also allows you to choose a remainder or residuary, where anything leftover (i.e. not devised) in your estate will go. Generally, unless you set up your estate otherwise, most estates go through the probate process. Probate can get complicated and expensive if you have a larger estate and no Will or other estate plan. Luckily, a Will can streamline this process by providing for your exact distributions without having to resort to the intestacy statutes. Furthermore, in your Will, you can name who you’d like to be your personal representative. A personal representative is the person who oversees the handling your estate. Because this is such an important role, it is important that you not leave this for the court to pick.

Another important consideration in creating a Will is if you have minor children, you can nominate a guardian for your children. This guardian will be responsible for the care of your child, and you can nominate someone you and your children know and trust. Otherwise, if there is no other surviving parent, the court may choose someone for you. Lastly, a Will allows you to provide instructions for your funeral/burial. Providing instructions ahead of time eases the burden on your loved ones of having to figure out your wishes.

2. Trust

Another common type of estate planning tools is the trust. There are a few types of trusts, for example, a testamentary trust (a trust contained in a last Will and Testament), an inter vivos or living trust, which is created and funded while you are still alive, and an irrevocable trust wherein you gift monies, permanently to others during your life.

A testamentary trust does not avoid probate, a living trust does, which is a great way to avoid extra time and expenses in administering your estate. However, a testamentary trust still has many benefits. Like a will, a testamentary trust designates how your assets are distributed upon death, i.e., to the trust, and then controls how the assets are used or when they should be delivered to your chosen beneficiaries. In a testamentary trust, you designate a trustee who manages the assets before they are distributed to your designated beneficiaries. The benefit of a trust over a Will is that you have more control over when and how the assets are distributed, meaning you can attach conditions on distributions, such as attaining a certain age, marriage, or graduating college. This is important if the beneficiaries are young children who cannot yet manage their own finances. Furthermore, you can set up a trust with distributions only for the health, education, maintenance and support of the beneficiaries. This allows the trust to be invested and grow while avoiding potentially large lump sum distributions that can take place with just a Will.

Some of the other benefits of a trust are asset protection, meaning you can protect your assets after death from legal action or potentially irresponsible financial decisions of any beneficiaries.

Another option is the living trust that is revocable by you during your lifetime. The living trust is a legal document that re-titled your assets, such as bank accounts, investment, real estate, and other valuable personal property in the name of the trust for your own benefit during your lifetime. The living trust does avoid probate because the assets are transferred to the trust while you are still living. This has the benefit of saving on probate costs and attorney’s fees, while maintaining the same benefits as discussed above. With the living trust, you are still in control over the assets during your life.

There are several more trusts

and estate planning techniques available and you should consult an estate planning professional for a consultation.

3. Advanced Directive

Different from a will or a trust, an advanced directive handles your medical decisions while you’re still living. An advanced directive is a legal document that explains how medical decisions regarding your health are made. You can designate someone to make decisions about your medical treatment while you’re unable to (also called a health care surrogate). This document lets doctors and other health care professionals as well as your loved ones know exactly which medical decisions you want if you become incapacitated and cannot express your medical wishes. There are a few types of advanced directives you can consider, a living will, a do not resuscitate order and a healthcare surrogate. A living Will, which takes effect while you are still alive, can cover many of those issues. A living Will is a written statement of medical care you do/do not want to receive if you become incapacitated. It can cover issues such as resuscitation (typically this is called a DNR or do not resuscitate), ventilation, organ donation, and end of life care. If you have specific care wishes you want to ensure are carried out, it is a good idea to consider creating an advanced directive.

4. Durable Power of Attorney

A durable power of attorney is an incredibly important document to have in the event you become incapacitated or unable to care for yourself. A power of attorney is a legal document that gives the designated person (attorney-in-fact) the power to act on your behalf, but these documents are typically no longer effective if you lose mental capacity. The durable power of attorney, however, is similar except it is effective even in the event you become mentally incapacitated. A durable power of attorney allows your attorney-in-fact to make decisions on your behalf regarding both medical care and your finances. Your power of attorney can, for example, pay your bills, manage your investments, make care decisions for you, or anything else you include in your durable power of attorney documents. Importantly, having a durable power of attorney in place can prevent you from having a guardian appointed in the event you do become mentally incapacitated. This can save you time and money and allows you to pick someone you know and trust will make the right decisions on your behalf.

Everyone has different estate planning needs and there is no one size fits all solution. Therefore, it is important to speak with an experience and knowledgeable attorney who can help you decide which estate planning tool is best for you and ensure you maximize the benefits of any and all estate planning tools with careful drafting.


bottom of page