Estate
Planning Basics
What
is an Estate Plan? _________
Simply
stated, an estate is the collective assets, large or small,
a person owns when he or she dies. A person's estate is distributed
to his or her heirs according to dictates of a will or trust. If there's
no will or trust then the estate passes according to the laws of the
state.
If
the estate is distributed by a will or by the laws of the
state, it requires a court process called probate. There are several
reasons to avoid probate. Probate is a lengthy process which delays
the fulfillment of your wishes. It is a matter of public record and
the process of estate administration can sometimes result in controversies
and litigation that may incur additional expense .
Estate
planning, on the other hand, prepares for the orderly handling,
disposition, and administration of an estate. Estate planning includes
drawing up a will, establishing trusts, and taking the steps necessary
to minimize estate taxes.
A
well-designed estate plan allows you to decide the outcome.
It can preserve more of your assets and allow you to pass them to
the people and causes you care about most.
While
most people are familiar with a will, many don't realize
its limitations, regardless of how carefully it is constructed. Many
people mistakenly assume that a will is all that's necessary, when
a more comprehensive approach is actually needed. Even a modest
estate may gain substantial benefits from a professionally designed
estate plan.
What is a Trust? ____________________
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A
trust is a very personal and carefully designed document.
It may be the best solution for addressing the complexities associated
with preserving assets while providing for the future benefit of your
heirs.
There
are two broad types of trust. A living trust takes effect
during the owner's lifetime and a testamentary trust takes effect
upon the owner's death. Under certain circumstances, a trust can help
you:
- Take
advantage of tax credits available to you, your estate, and your
beneficiaries
-
Maximize the assets available for distribution to your beneficiaries
-
Direct the distribution of assets to specified individuals or organizations
-
Secure the continued care and financial support of loved ones who
are elderly, disabled, or financially inexperienced
- Provide
for loved ones in a way which reduces complexity and cost to them
-
Minimize court and legal involvement
-
Ensure ongoing management of assets should you become unable to
do so
-
Maintain privacy
- Achieve
personal charitable giving goals
Is
a Living Trust enough? __________ Back
to Top
A living trust may avoid probate but it will not reduce or eliminate
estate taxes without additional planning.
Is
it expensive to have an estate plan?
The cost of developing and setting in place an estate plan depends
on the complexity of your situation and size of your estate. There
are some attorneys who perform these services for a flat fee. However,
the cost of estate planning is generally small compared to what you're
likely to save with a well constructed estate plan.
Officers'
Christian Fellowship has joined with PhilanthroCorp to offer
our donors professional counsel without cost in many cases.
How
can I learn more? ________________
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Request a free phone conference with one of PhilanthroCorp's estate
specialists, please call 800-876-7958 ext 2127, or email (click
here)
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