A caretaker loves his/her family and works hard for them. To give them a standard and luxurious life, they often establish and build a business. They work hard to grow their business. Their hard work becomes fruitful and them and their family start enjoying the benefits of that hard work. Suddenly that person dies… Their business and loved ones without them become trapped into a critical state. Both emotionally and often financially deprived, their family is unable to decide what to do with the business and household finances.
These situations can be avoided by prior planning. Good planning makes good sense. Following are the few legal plannings that one should make to secure their family from the crisis. This crisis may be due to sudden death, a health crisis, disability or accident. Whatever the case, although hard to think about, proper planning before hand is crucial to set families up to deal with this sort of tragedy.
A trust is created by the settlor for beneficiaries. In the trust, the trustee is the one who hold the assets of the trust and manages them. While beneficiaries are the ones who benefit from the profit generated from the assets of the trust.
Beneficiaries may include a spouse, friend, children or anyone declared by the settler and the trustee may be a bank, financial institution, or individual. The trust is used during life or upon death by beneficiaries. There may a dynasty trustee which means that it continues forever. It may be revocable or irrevocable. Irrevocable is a trust that cannot be changed, while revocable can be changed by the settlor at any time.
A will is generated during life and is applicable upon death. It is the document prepared by the property holder in which he/she declares to whom their assets will be distributed after their death and in which proportion.
There are a few types of property which do not come under a will. A non-probate property includes trust assets, jointly held property (joint tenants with right of survivorship (JTWRO)) and life insurance. For a will to be valid, certain legal requirements of the local area must be fulfilled, otherwise the will is not valid. For example, in a few states, it is required that the will be signed in the presence of two witnesses who are not related.
In intestate means, if a person dies without a will, then the state has a default will. Default rules define to whom property and assets will be given to after death.
Property Power of Attorney
A property power of attorney specifies the individual who may take control of your finances. It is designed during life when an individual is not capable of deciding for themselves due to many reasons. Forms of POA cover almost all categories of property and assets. The property which is not covered under POA can also be enlisted in these forms. An experienced and competent legal professional can be consulted for the most appropriate property power of attorney. Insurance, safety deposit boxes, business accounts, personal belongings and real estate are covered under this designation.
Health Care Power of Attorney and Advanced Directives
A health agent is an individual who decides about your health-related issues in critical situations when you are unable to decide on your own. A trustworthy and responsible person is selected. They are required in critical stages of health. A Health Care Power of Attorney form specifies who that individual is. That form is also known as “health care sudden emergencies and in long-term disease and designation”, “durable health care power of attorney”, and “health care proxy” in different states. This is effective during life and not upon death. This person has to make the following decisions:
- When to be admitted into the hospital and when to discharge
- Which treatment or procedure is to be taken or refused
- Consent for the treatment
- When to withdraw life-sustaining treatment
Proactive planning for a business and for loved ones should be done to secure their well being when you are no longer able to care for them.
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