Trust-Based Planning
The revocable trust is often the foundation an effective estate plan. Revocable trusts give instructions to your chosen successor trustee upon your passing or incapacity. Typically spouses choose each other as the first successor trustee. Often, clients choose to use trusts rather than just a will to avoid the costly process of probate. Probate is the process by which a district court determines who gets what property. Wills must go through probate.
Another advantage of using a revocable trust is privacy. Because trusts are not probated, assets held by a trust and the instructions given in a trust remain private. In contrast, once a will is probated a list of assets and the beneficiaries become public record.
Although Elwell and Spain often recommends the use of a revocable trust for estate planning, there are estate plans which do not benefit greatly from a trust. We always take a case-by-case approach to identifying the most beneficial estate planning tools for each client. We will never “sell” you a trust.
If a client decides to use a trust in their estate plan, the trust must be appropriately funded. Funding a trust involves transferring certain assets to the trust. Unfunded trusts typically end up in the probate process. It is important to work with an experienced estate attorney to help determine which assets should be transferred to a trust and which assets should not be transferred. Elwell and Spain helps their clients with the initial funding process of their revocable trust.
Will-Based Planning
All estate plans should at least include a will. Wills accomplish two important goals. They name the executor of your estate and they list the beneficiaries of your property. Without a will, it is likely that your property will be distributed to heirs as determined by state statute. These laws do not always conform to people's expectations. For example, it is typical for children to receive half of a married couple's assets upon the first spouse's passing. A properly drafted will ensures that property goes to the intended beneficiaries.
Wills also serve to appoint an executor in the probate process. An executor of an estate, once appointed by a district court, directs the estate through the probate process. This process typically includes giving notice to potential beneficiaries and creditors, making an accounting of the estate’s assets, and finally distributing assets to creditors and beneficiaries.
Many people believe that a will does not need to go through the probate process. Unfortunately, Oklahoma still requires that wills be probated.
Medical and Financial Power of Attorneys
Power of Attorneys, both medical and financial, are an essential part of the estate planning puzzle. Without these documents a court administered guardianship could become a reality. These documents name an agent to act on your behalf if you are no longer able to act for yourself due to incapacity. Because of the technical nature of these documents it is a good idea to have an experienced attorney at least review any previously established power of attorneys.
Oklahoma also allows for the use of an Advanced Directive. This document gives directions to medical professionals if you are not able to do so. It also allows you to elect an individual to help make these decisions.