Estate Planning Terms to Know
June 1, 2022
There are many ways people plan for the future. Maybe it means investing money or starting a savings fund for your children. Perhaps you’re investing in your education or purchasing a new home. Whatever it means to you, one aspect that should never go overlooked is your estate plan. No matter your age, level of wealth, or health status, everyone should think critically about what will eventually happen with their assets.
An estate planning attorney can help you understand important estate planning terms and what options work best for your specific needs. If you’re in Pittsburgh, Pennsylvania, or the surrounding counties, contact us at the Law Offices of Kelton M. Burgess, LLC to get started.
Estate Planning: Important Terms to Know
Estate planning is more than simply drawing up a will. A comprehensive estate plan should include provisions on who will receive what assets as well as who will make important decisions on your behalf should you become incapacitated. This authorization could be related to your health or it could be related to your finances. Lastly, a well-written estate plan can save your family time and money after your passing since it can help avoid the process of probate and limit in-fighting if all your wishes are clearly laid out.
Before you begin planning, you should educate yourself on some common estate planning terminology that you’ll encounter.
Decedent: The deceased person
Estate: Your estate encompasses all the assets you have at the time of your death, including money, investments, property, family heirlooms, vehicles, business holdings, etc.
Probate: Probate is the legal process in which a will is “proved” in court. During probate, your assets will be recorded and processed through the courts before they can be distributed to your heirs. This ensures creditors have an opportunity to address outstanding debt and that any applicable tax is paid.
Intestate: When an individual dies without a will in place
Will: A will is a basic estate planning document that can assign beneficiaries for your assets as well as appoint a legal guardian for any minor children. Most wills will have to go through the process of probate.
Trust: A trust is an estate planning tool that allows you to move certain assets into a trust while you are still living. Ownership of these assets will then move out of your name and into the name of your trustee, but you’ll maintain control during your lifetime and can move assets in and out of the trust. Your trustee can be someone you know such as a spouse or family member, but you can also name an attorney or trust company to administer the trust. Because you no longer own the assets, they’ll bypass probate upon your death and can be immediately transferred to your named beneficiaries.
Beneficiary: Anyone you name in your estate plan to receive a certain asset after your passing
Executor: The executor is the individual you name in your will who is responsible for executing (administering) your will after you pass. This person will be in charge of locating, inventorying, assessing, and distributing all assets. They will also have to contact all beneficiaries and creditors to address outstanding debt. If there is no named executor, a judge will appoint someone (usually the surviving spouse or family member) as the administrator.
Power of attorney: A person you name in your estate plan who can make legal, financial, or medical decisions on your behalf should you become incapacitated
Advance healthcare directive: Also called a “living will,” this document lays out your healthcare wishes should you become incapacitated. This could include the types of treatment you do or do not want and what kind of end-of-life care you want.
Guardianship: If you have minor children or adult children with special needs, you’ll need to name someone who will be their guardian after you pass.
Conservatorship: A person or business entity that manages your estate while you are incapacitated
Legal Guidance You Can Trust
If you’re curious about starting an estate plan but aren’t sure where to start, call us at the Law Offices of Kelton M. Burgess, LLC. We’re proud to serve those in and around the Pittsburgh, Pennsylvania, area with all their probate and estate planning needs.