Georgia Estate Planning 101
Your Guide to Estate Planning Documents and the Importance of Creating an Estate Plan: Everything You Need to Know
Do I really need an estate plan?
Yes! No matter how much property you own, the number of children you have, your age, or your marital status, everyone needs a basic estate plan in place. Having an estate plan allows you and your loved ones to have a peace of mind when it comes to managing your affairs and disposition of property.
Georgia estate planning allows you to declare the disposition of your property after you pass away; and you may also declare your financial wishes and health care wishes in the event you are not able to make those decisions for yourself.
There are three documents in a basic Georgia estate plan: a Last Will and Testament, Financial Power of Attorney, and an Advance Directive for Health Care. Each document has a unique function and importance in your estate plan.
Document #1: Last Will and Testament
A Last Will and Testament is the most common document people think of when an estate plan is mentioned. Your Last Will and Testament, or more simply your "will," is a legal document that takes effect after your death and spells out the disposition of the property you own at the time of your death. The property you own includes both real property and personal property. In your will, you may name the people (or organizations) you would like to receive your property and and describe exactly how your property is to be divided and disposed of. You will also nominate a person, the executor, who will be responsible for carrying out your wishes and ensuring any debts owed by you are paid from your estate.
For those with minor children, a will is imperative because your will allows you to designate a guardian of your children in the event that both you and your spouse pass away. Without a guardian appointed, the court will step in and appoint its choice of guardian over your children. This process may be time-consuming and costly, and the person appointed as guardian may be someone you would not have chosen to look after your minor children.
An important note is that your will only disposes of probate property. Property with beneficiary designations such as banks accounts, life insurance, retirement accounts, and investment accounts pass outside of your will to a beneficiary you have designated on those accounts.
Perhaps the most important aspect of having a will in place is that you decide how your property is disposed of, and not state law. In Georgia, if you do not have a will when you pass away, state law steps in and lays out a framework for the disposition of your property among your legal heirs. This method of disposition of your property may not align with your wishes, and it may cause disagreements among family members over your property.
Document #2: Financial Power of Attorney
A Georgia financial power of attorney allows you to nominate an individual or individuals to make financial decisions on your behalf when you are unable to do so, usually due to an incapacitation. In the event of an incapacitation, the person you have appointed will handle the financial affairs you have spelled out in the document on your behalf. Without a financial power of attorney, the probate court would have to appoint someone to make financial decisions for you, increasing the costs, time, and stress for your loved ones.
Once properly executed, your financial power of attorney takes effect immediately, but you will still have the power to act for yourself in financial matters until you become incapacitated or are unable to do so.
Document #3: Advance Directive for Health Care
An Advance Directive for Health Care allows you to nominate a person to make or follow health care wishes on your behalf when you are unable to make certain medical decisions for yourself. In the event of an incapacitation, terminal condition, or state of permanent unconsciousness, you will not be able to give your preference for medical treatment without an Advance Directive for Health Care. With this document, you may make advanced decisions about organ donation, burial instructions, pregnancy, and life support.
By making advanced decisions for certain medical scenarios, you spare your loved ones the time and stress of making a medical decision on your behalf. This document also allows you to nominate a guardian to take care of you in the event you can no longer manage your day-to-day affairs, sparing a loved one the time and cost of asking the probate court to have a guardian appointed over you.
It is always important to make sure you revisit your estate plan from time-to-time in order to ensure that it still reflects your wishes and your family structure, and is up-to-date with current law.
If you would like to discuss your estate plan in more detail, or you are thinking about creating an estate plan, contact McRee Law, LLC at 706-335-4946, and we will be happy to discuss your estate plan or set up a consultation.