Estate planning is the process of planning or deciding how your estate—your real and personal property and assets—will be passed down to your heirs and beneficiaries.
We need estate planning in Texas because of what will happen in the absence of an estate plan. In Texas, if you don’t have a will or any other estate planning documents, “Intestacy Laws” take over. Intestacy Laws are a pre-determined set of laws that dictate who will receive what, in what percentage, and in what order.
Essentially, if you don’t want the state to make decisions for you, you need to plan ahead and make those decisions for yourself.
Is Estate Planning Just For What Happens After I Die, Or Can Estate Planning Benefit Me During My Lifetime?
Estate planning is often for much more than what happens after you die.
A thorough estate plan consists of two parts:
- Property Dispensation
- Disability Documents
When it comes to property dispensation, estate planning is the vehicle that lets you decide what happens to your property and assets after you die. That could mean:
- Establishing a will
- Establishing a trust
- Probate-avoidance measures (which essentially saves time, money, and effort for your heirs/beneficiaries)
It could also mean setting a number of different legal structures by which you can ensure that your property is dispensed to the people you want, in the way that you want.
In many cases, the disability documents are just as important as the property-related documents. These documents are included in every estate plan that we do in Texas. They allow you to establish what you want to happen in case you need help at some point in your lifetime and create the legal basis for those wishes to be carried out.
People are living much longer these days. With a longer life also comes a higher chance of potentially becoming incapacitated, or unable to care for yourself or make important decisions for yourself. If you reach that point, you will want help dealing with the basic management of your life and making most of the essential decisions affecting your life.
We include disability documents in all our estate plans to ensure you receive that help. Those can consist of:
- Statutory durable powers of attorney
- Medical powers of attorney
- HIPAA releases
- Guardianship provisions
- Living wills
- Physician’s directives
- Appointments of agency for guardianship
- Appointments of agency for disposition of remains
Some of these can be just as important—or even more important—than a will.
In Texas, Is It Enough To Have A Will On Its Own?
The answer to this question, like many answers given by lawyers, is that it depends. Whether or not a will is enough for you in terms of estate planning in Texas depends on a number of factors.
When deciding whether a will is enough for you, one of the main factors we consider is what sort of property and assets you have, and how that property is characterized.
If your only asset is a bank account and you live in a rented apartment, for instance, then you may not need a will at all. You may only need a plan to dispose of your non-probate assets.
However, most people in Texas will have more property than that, and they are going to need wills. For many of those people, a will can be sufficient on its own. However, even if a will is sufficient, you also need a plan to go along with the will. When putting a will together, it is essential to seek the counsel of an experienced Texas estate planning attorney, who can ensure that your will has all of the wording and provisions necessary to execute your estate in accordance with your goals and wishes.
How Often Should I Be Reviewing My Estate Planning Documents? Can I Make Changes Or Updates To My Estate Planning Documents At Any Time?
I recommend that people pull out their estate planning documents about every 5 to 7 years for review. That time span is long enough for many changes to occur. Your family situation could have changed, your financial situation could have changed, and even the law could have changed. As such, it is always good to review your estate planning documents every 5 to 7 years (or whenever else you know a large change has occurred in your life, in your financial situation, or in the law), to ensure that they still meet your needs.
You can make changes to estate planning documents at any time, and it is quite easy to do. When making changes to these documents, you can either:
- Execute a new will
- Execute a codicil
- Execute an amendment to your living trust
- Update your ancillary documents
Even though changing these documents can be pretty easy, I still recommend seeking the help and counsel of an attorney in doing so. It is essential that these changes are executed properly. The consequences for improper execution of changes to estate planning documents can be dire. Therefore, it’s always best to at least pass the documents by an attorney before assuming they are up-to-par.
When Is The Best Time To Begin Your Estate Planning, Or To Start Setting Up Your Estate Planning Documents? Is It Ever Too Early? Is It Ever Too Late?
I don’t think it’s ever too early to start setting up your estate planning documents. The problem I generally find is that no one never wakes up on a bright sunny day and says, “Hey, I think I’ll do my will today”.
It can be disturbing and/or uncomfortable to deal with probate and estate planning issues, since it means dealing with mortality. Many times, this leads people to put off estate planning tasks, sometimes until it’s too late to avoid massive pitfalls.
As far as I’m concerned, as soon as you own property, it becomes essential to set up an estate plan. This is especially true if you don’t have a traditional family and don’t want the state to decide who receives your belongings and how.
I also believe that all adults should have disability documents in place once they are no longer minors, usually at age 18. Personally, I asked each of my children to sign Powers of Attorney as soon as they turned 18, just in case of an emergency where those documents might be necessary.
For instance, I had a friend whose child went off to college after they turned 18 and was legally considered an adult. The child experienced an acute mental health crisis as she adjusted to school and were eventually admitted to a psychiatric facility. Thankfully, my friend asked his daughter to sign Powers of Attorney documents before she went off to school. If he hadn’t had Power of Attorney in the event of her incapacitation, he wouldn’t have been able to do things like deal with her apartment, her car, her enrollment in school, or even get information on her status in the hospital.
This is only one example of many. In the end, I think that these documents really benefit everyone. We all need help from time to time, and everyone needs to have a plan in place to access that help if it becomes necessary to do so.
Is Estate Planning More Of A One-Size-Fits-All, One-Time Transaction, Or Should I Be Changing My Estate Planning Documents With Every Phase In Life?
Again, the answer to this question depends on your circumstances. However, there are many good reasons for many different people to change their estate planning documents as time passes and their lives change.
For example, people in different phases of life tend to have different needs from estate planning. If you’re very young and don’t really own any sizable assets or property, simply having Powers of Attorney documentation in place might be enough.
As people grow older, they often accumulate more assets and responsibility, at which point I believe that it becomes important to have a plan. This could be just ensuring that their bank account has a pay on death beneficiary, or bequeathing their home and personal property to their heirs. Regardless, I believe it’s important to have something planned out and on paper just in case.
Different life events also mean different needs for estate planning. If you are the parent of young children, your estate planning documents will be largely concerned with protecting your children and ensuring that someone of your choosing will become their legal guardians if you pass away, as well as setting up financial structures to provide financial support over time. Sometimes, the details of those wills need to be changed. For instance, if the person you originally named as a guardian for your children passes away, or you have a falling out with them, you will need to change your documentation so that it is accurate in case something happens.
If you are the parent of adult children, your estate planning needs will also change. You no longer need your will to provide guardianship provisions. As you age and your children age, and they become the “caretakers” in the family, you will want to focus on documents that state your wishes for end-of-life care and incapacity, as well as general estate matters and property dispersal.
Generally, I would say that checking in with your estate planning documents and making necessary updates is necessary and good.
For more information on Estate Planning Law In Texas, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (512) 355-0155 today.
