Estate Planning Terms to Know
Creating an estate plan can be a daunting task if you are not familiar with estate planning terminology. For many people, estate planning can be complicated and somewhat confusing. However, the more you learn about the process, the less overwhelming it gets.
Understanding estate planning terms and seeking legal advice from a knowledgeable attorney can help you navigate the estate planning process. Without knowing what various estate planning terms mean, you may not be able to make informed decisions.
As an estate planning attorney at CornerStone Law, LLC, I help clients understand estate planning terms during consultations to ensure that we are on the same page. With an office in Newton, Kansas, I serve clients throughout the state of Kansas, including Reno, Cowley, Butler, Saline, Sedgwick, Marion, Harvey, and McPherson counties.
Why Estate Planning Is Important
Estate planning encompasses a variety of legal documents that specify how you want your assets and money to be distributed and your affairs to be handled in the event of your death or incapacity. Important reasons to create an estate plan include:
You can make your wishes known
You can avoid unnecessary taxes
You can minimize or avoid the costly and time-consuming probate process
You can protect your assets and best interests if you are incapacitated
You can give your loved ones clarity and peace of mind
If you are considering creating an estate plan, you’ll need the assistance of a skilled attorney. An attorney will help you prepare the necessary documents and ensure that your plan is tailored to your specific needs, goals, and circumstances and complies with applicable laws in your state.
Key Estate Planning Terms to Know
As you research the estate planning process, you will most likely come across a lot of estate planning terms that may be unfamiliar to you. Below is a list of some of the most commonly misunderstood estate planning terms that you need to know:
Decedent. In estate planning, a decedent is someone who created a policy, trust, will, account, or plan. An individual is called a “decedent” after they pass away.
Estate. A person’s estate includes the total property – both real and personal – owned by the person before the distribution of assets takes place.
Probate. The term “probate” refers to a legal process in which the court determines the validity of the decedent’s will. After the decedent’s debts and taxes are settled through probate, the estate’s assets will be distributed to the beneficiaries.
Intestate. When researching wills, you may come across the term “dying intestate.” Dying intestate means dying without a valid will in place. When a person dies intestate, their assets will be distributed according to the state’s intestate succession laws.
Will. A will is a written document that contains instructions for the distribution of assets after the person’s death. Wills must be validated by the probate court before the distribution takes place.
Trust. In estate planning, the term “trust” refers to a fiduciary relationship between one individual and another party who is granted the right to hold title to property or assets for the named beneficiary.
Beneficiary. A beneficiary is any individual or entity designated in an estate plan to receive assets of the estate.
Executor. An executor is a person responsible for carrying out the decedent’s instructions spelled out in their will.
Power of attorney. A power of attorney is a document that grants an individual authority to make certain decisions on behalf of another individual.
Advance directive. The term “advance directive,” also known as an advance healthcare directive, refers to a legal document an individual creates to spell out their preferences regarding medical care.
Guardianship. In estate planning terminology, the term “guardianship” is defined as a court-supervised process in which a person is deemed incapacitated and another person is granted control over the incapacitated person’s personal and day-to-day decisions.
The terms mentioned above account for a small percentage of confusing terms you may encounter when doing your research about estate planning. Seek legal advice from an attorney to learn more about estate planning.
Skilled & Comprehensive Counsel
Planning for what will happen to your assets and loved ones when you pass away can be a challenging and emotionally taxing experience. Fortunately, you can seek skilled counsel from an experienced attorney to get your estate plan in order. At CornerStone Law, LLC, I help create personalized estate plans for clients in Newton, Hillsboro, Wichita, El Dorado, Hutchinson, McPherson, and other parts of Kansas. Contact my office to talk about your particular situation.