Need an Estate Planning Lawyer in Clifton, New Jersey?

Estate planning is one of the most important things you can do to protect your assets and beneficiaries. With proper estate planning, beneficiaries do not need to wait through probate. Estate planning can also prepare you for the distinct possibility of needing long-term care. 

Rosenblum Law’s estate planning lawyers are experienced in all aspects of estate planning. We can evaluate assets and circumstances to determine the proper estate planning tools for the situation. Contact us today for a free consultation, and keep reading for more information.

What is Estate Planning?

Estate planning involves drafting legal documents that dictate what happens to someone’s assets when they pass or become incapacitated. The objective of estate planning is to protect these assets for the owner’s beneficiaries and provide peace of mind.

There are some key components of an estate plan, including:

• Wills: Everyone should have a will that dictates what happens to their assets and designates guardians for any minors in their care.
• Trusts: There are a variety of revocable and irrevocable trusts that can protect assets for future beneficiaries.
• Powers of Attorney: Powers of attorney allow someone to handle financial matters on someone else’s behalf in case they become incapacitated.
• Healthcare Directives: Also known as living wills, healthcare directives dictate whether and when extreme life-saving measures are taken. 

It is important that an estate plan includes protections for beneficiaries, and that beneficiaries are named in the will in accordance with the terms of trusts and life insurance policies. During estate planning, the owner of the estate also chooses an executor and may wish to make charitable donations.

Key Elements of Estate Planning in Clifton, New Jersey

There are some key elements of estate planning that are included in most estate plans, although not all of these will be needed in every case. 

Wills and Trusts

A last will and testament is a legal document that names an executor of the estate and details how possessions, assets, and property are divided among beneficiaries. A trust is a complex legal instrument that creates an account filled with assigned assets. The trust is managed by a trustee in most cases, and thus it is important to choose a trustee who is financially responsible and organized.

Wills and trusts have benefits and drawbacks. A primary benefit of a will is that one can leave specific items to specific people. However, a will becomes a matter of public record when it goes to probate. Probate can last months or years, and nothing can be distributed per the will until probate is complete. A will also does not protect assets from creditors or protect against estate taxes.

A primary benefit of a trust is that assets pass directly to beneficiaries at the time of the grantor’s death or another time of the grantor’s choosing. A trust does not have to go through probate, and an irrevocable trust will protect the grantor’s estate from estate taxes. Note that federal estate taxes are not assessed unless the estate is worth $13.61 million, and New Jersey doesn’t levy estate taxes. If one’s estate is worth less than $13.61 million, a revocable trust is sufficient.

Note that an irrevocable trust cannot be changed once established, and the grantor loses control of the assets in the trust. By contrast, a revocable trust can be changed and modified, and the grantor retains control of the assets. 

Powers of Attorney

It is important to have financial and medical powers of attorney. These documents allow for someone else to make decisions when the person who granted the power of attorney (the grantor) becomes incapacitated. A financial power of attorney allows an agent, also called an attorney-in-fact, to make financial transactions on the grantor’s behalf. A medical power of attorney allows an agent to make healthcare decisions if the grantor becomes unable to make those decisions for themselves. 

It is vital to choose a trusted agent who will act in the grantor’s best interests. A financial power of attorney thus should be someone financially trustworthy and responsible, and a medical power of attorney should be someone who understands the grantor’s healthcare needs and desires. 

Healthcare Directives

The medical power of attorney is also called a healthcare proxy and is one type of advance directive in New Jersey. A living will is an instructional directive that details someone’s wishes if they are incapacitated. The living will usually includes whether and when to stop life-saving or life-extending measures. 

It is important to make informed medical decisions in advance of something happening, including speaking with a primary care physician if there are questions about life-saving measures. The state of New Jersey also has a helpful resource here. 

Guardianship Designations

Parents should designate a guardian for their children in the event the parents are no longer able to care for them. The legal requirements for guardianship designations are found in Section 3B:12-74 of the New Jersey state code. In general, the standby guardian must be chosen and designated, and the document must be signed in front of two witnesses and notarized. 

Choosing a standby guardian is an important decision that should not be taken lightly. Make sure the standby guardian is able and willing to care for the child or children in question, and that the guardian understands specific parental requests pertaining to childcare and rearing. 

Beneficiary Designations

It is important to ensure that assets are properly designated, whether that be within a will, a trust, or by some other means. It may be possible, for example, to add a “transfer on death” to car titles and home deeds to avoid probate. It is also important that beneficiaries are clearly defined in life insurance and retirement accounts. 

Common Estate Planning Mistakes and How to Avoid Them

There are some common estate planning mistakes that can easily be avoided with the help of an attorney. 

• Failure to Plan: If someone does not have an estate plan, their assets and property are put through probate. There could be in-fighting between potential beneficiaries, and the assets could be tied up in probate for months or years. An estate plan protects beneficiaries and guarantees the estate owner’s wishes will be followed.
• Outdated Documents: Review an estate plan every three to five years and update it as necessary to ensure it is still accurate. If the estate owner acquires new assets or property or has a major life change, this also should prompt a review of the estate plan. 
• Improper Beneficiary Designations: Ensure that all accounts and policies are correctly designated, as improper beneficiary designations can delay or prevent beneficiaries from accessing assets upon death. 
• Ignoring Tax Implications: If the estate owner’s assets and property meet the federal minimum mentioned above, it is important to understand and plan for potential tax liabilities. An irrevocable trust is one way to avoid such issues.

FAQs

Contact Rosenblum Law Today

It should be clear why estate planning is important. If you want to protect your beneficiaries and their inheritances, estate planning is the best option. It is best to work with an experienced estate planning lawyer who can identify the elements of an estate plan that meet your needs and goals.

Rosenblum Law attorneys have decades of experience in estate planning for both large and small estates. Contact us today for a free consultation.