A proper estate plan is critical for everyone – no matter their level of wealth or income. At its core, estate planning is not really about the value of assets involved, but the desire to control and ensure that your wishes are honored when you are no longer able to speak for yourself. Do not let yourself be silent by failing to plan for the inevitable. With this in mind, the following documents should be in place for all, regardless of wealth or income status:
- Last Will and Testament. This document allows you to control how the assets held in your name alone, called probate property, will be distributed upon your death. It allows you to provide distribution of specific property to individuals outside of your family. You can also nominate Guardians of your minor children and name a Personal Representative of your choosing to handle your affairs. A Will allows for incredible flexibility as to bequests to individuals or entities that you wish to benefit from your estate upon your death, regardless of their family relationship to you. For those that wish to provide for their beloved animals after they are gone, a Pet Trust can be created under a Will, providing guidance and resources to a caretaker of your choosing.
- Financial Power of Attorney. This document allows you to appoint an Agent or Attorney-in-Fact to handle your financial affairs on your behalf. It grants very broad powers, giving them the authority to basically perform any action related to your finances or contract, along with the duty to perform said actions in your best interest. Depending upon your planning needs, language related to power over Trust Agreements, gifting your property, and changing your beneficiary designations can be included. This document also helps to avoid the need to petition the Circuit Court for guardianship over your property when you are no longer able to handle your affairs, as the Attorney-in-Fact can manage them on your behalf.
- Advance Medical Directive/Health Care Power of Attorney/Living Will. This document allows you to appoint someone else to make medical decisions on your behalf, in the event you are unable to do so. It also allows your agent to interact with your medical professionals, serving as a resource to you related to any ongoing medical needs. The document also provides guidance as to your end-life wishes, such as in the event you face the end of a terminal illness or are in a coma, whether or not you want to receive pain medication, and includes your directions related to organ donation. This document also helps to avoid the need to petition the Circuit Court for guardianship over your person/body if you are unable to make those decisions yourself.
Depending on your specific situation, you may also wish to implement the following documents:
- Trusts (Revocable/Irrevocable). Trusts are useful tools that can be created to serve a variety of purposes, for the benefit of your spouse, children, friends, extended family members or other loved ones. Unlike a Last Will and Testament, which must be publicly filed when you pass away, a Trust is a private disposition of your assets. It can also be a useful tool to protect funds for those with special needs, assisting them in maintaining eligibility to receive government benefits, while also providing additional resources for their supplemental needs. Trusts are also useful to shelter funds from those that are simply not responsible with money. The Trustee also serves as an advocate for the Trust beneficiary, ensuring that they have a safe, secure, and comfortable life.
- Deeds. The titling of real estate is important to any estate plan. There are different ways to hold property that may coincide with your goals, such as holding property as tenants-by-the-entirety with your spouse, or by owning a life interest in your property so that upon your death, the property would flow directly to your children, by operation of law.
Another important aspect of the estate planning process is the desire and ability to engage in charitable planning. Often, members of the LGBTQ community prefer to leave a portion of their assets to support charitable endeavors, including those that specifically support and protect vulnerable members of the community. Working with your advisors can help you identify potential charitable goals and resources.
Essential to any estate plan discussion involves a careful review of how your assets are titled, including the beneficiary designations currently in effect for your retirement accounts and life insurance policies. These are considered non-probate property and are not controlled by your Last Will and Testament. All of these financial pieces need to be reviewed and considered when putting a plan in place, and whenever a major life change has occurred.
In Maryland, if you do not have these documents in place, then the decisions related to your body and assets, both when you are alive and when you pass away, are controlled by the State of Maryland, rather than you. Sometimes, this can mean that a family member that does not agree with your membership in the LGBTQ community, or would not honor your wishes, is granted broad authority over you and your assets. Current law assumes that such power should be granted based on blood relation, rather than personal connection. Thus, it is essential that members of the LGBTQ community have such documents in place, rather than trusting in the statutory defaults.
Estate planning with LGBTQ issues should be done with the careful guidance of an experienced LGBTQ estate planning attorney who is also intimately familiar with the needs of the community. A comprehensive estate plan is the best way to prepare for any eventuality. Contact the attorneys at Frame & Frame to explore your options and schedule a private consultation. We have been providing legal guidance to families in our community for over 65 years.