I WAS WONDERING...

What is an "estate plan"?


A set of documents reflecting your wishes and intentions for your care, and the administration and distribution of your assets (money, property, business interests, vehicles, real estate, etc.). Specifically, documents prepared by an attorney that specify in part: (1) how you do or do not want your assets distributed or handled in the event of incapacity and/or upon death, (2) who you want or do not want to carry out your plan, (3) who you want or do not want to make your financial or medical decisions in the event that you are legally unable to do so, and (4) if you have minor children, who you want (again, and who you would not want) to raise them if you could not. With an estate plan, you are able to rewrite the statutory default laws in place to fit your specific circumstances.




What is a Revocable Trust?


A Revocable Living Trust, like a Will, is a legal document that contains your instructions for what you want to happen to your assets when you die and who you want to administer them through a probate or non-probate process. But, unlike a Will, this type of Trust can also outline how you want your assets handled in the event that you are incapacitated (during your lifetime). Also, trusts (if properly funded) avoid probate at death (which a Will may not do), are handled without court supervision (unlike a Will), and can provide creditor protection for assets left for beneficiaries that are minors, spendthrifts, immature, etc. A Trust can be as complex or as straightforward as you'd like to carry out the most specific or broad wishes and plans.

Once you set up and "fund" (retitle assets) a trust with your assets, then you no longer legally own them, your Trust does. However, you retain control over these assets during your lifetime (as the Trustee of this Trust). When you die, trust assets do not require court supervision for their administration or distribution.

Simply, a trust in place is what keeps your estate plan private, your family out of court, and let's you determine the course for you assets, as well as minimize costs.




How much does this cost?


This is not an answer anyone likes, but its a honest one - "it depends". There are a number of factors that go into determining the price - your wishes regarding your property and assets, your concerns over assets, family, reducing the burden to family and loved ones, your family dynamic, your control comfort level, the value of your assets, etc. However, there is no out-of-pocket cost to you to determine what your fee will be. The costs for estate planning documents or a complete estate plan can range from $675 to $3,300+. Remember what appears to cost less today to set up may cost more (money, time, stress) tomorrow to administer. Invest your money now and create a plan that allows you more control over the outcome.




What if I already have an estate plan?


Good for you! You are among the 40% of Americans that have estate plan documents in place. But... is your plan still the best plan for you, does your plan state your current wishes, are the individuals named in your documents still the best to fit each role? If your documents were drafted more than 3 or 4 years ago, or there has been a major change in your life (birth, death, divorce, increased/decreased assets), it is time to review. As situations, circumstances, and people in your life change, your estate plan should too. Contact the office or schedule a meeting online today for a complimentary review.




Isn't a Will all I need?


Maybe, but probably not. A Will is simply a set of instructions to a judge describing how and to whom you want your assets distributed and who (Personal Representative/Executor) will handle this for you. Since a Will only takes effect after your death, it cannot and does not provide any planning or instruction if you become physically or mentally incapacitated. If that happens, you might find yourself going through "living probate", which is court supervision to take control of and manage your assets, as well as appointing the person(s) to do this without any input from you.




Aren't documents on the Internet just as good?


Maybe... or maybe not. The issue, or one of the issues with things we find on the internet, of course, is that we cannot confirm the preparer or the source. If you use documents that are not prepared by Michigan attorneys, then they might be "good" or they might just provide a false sense of security that your plan is in place. Unfortunatley, you won't know how good they are until it might be too late.

Is a DIY estate plan a good idea? Probably not. It is usually a better idea to see a doctor if you don't feel well rather than looking up your symptoms online. Plus, if you do that, you probably have that nagging suspicion "I should probably just call the doctor."

Again, documents that are available online might be fine... or they might cause problems down the road. This could be an expensive internet search. There is no guarantee that these documents will fit your unique situation or are even valid in Michigan.

If you already prepared a “D-I-Y Estate Plan”, your intentions were good, however, it is a good idea to have it reviewed by an attorney.




What if I don't have time to plan or don't care what happens if I don't plan?


Of course that is your choice, however, the people that will pay the price for your choice will most likely be your children, family, and loved ones who are trying to figure out what to do without your guidance or input during an emotionally charged time.

Most people that have dealt with estate administration in some way will probably tell you that this is stressful, time-consuming, expensive, and a burden for family and loved ones during an emotional time in their lives and they would have gladly paid someone to take care of things BEFOREHAND!

Also, if you have beneficiaries that could use the money or other property that you would leave them, it could be months, if not years, before a probate court settles the estate and distributes your assets to your beneficiaries.




What is probate?  Is it so bad anyway?


Probate is a legal process that may be required to distributed your assets. Also, during this process, a Court determines if your Will is valid, your debts are paid, appoints a Guardian for minor children, and then distributes your assets according to the terms of your Will.

If you do not have a Will, or the Will you had is invalid for some reason, your assets are distributed according to Michigan law (this is called Intestate Succession) to people in your blood-line - whether you want them to inherit your assets or not.

If Probate is required for your estate, it is a public process, can be expensive (paying hourly fees to an attorney), and time consuming; however, it is not always necessarily "bad." For some, the idea of a court overseeing their affairs and distribution of property to family or loved ones is preferred. This is probably a minority group, but worth mentioning.




What if I don't have "a lot"?


Estate Planning is not just for the rich and famous.

Estate Plans are important for everyone - we cannot foresee incapacity during our lifetime, nor can we predict death. Planning ahead allows you to get your ducks in a row as far as your assets (your property) goes should you become incapacited and after death. This will greatly assist those left behind to navigate the waters without your input.

  • If you are over 18 years old, single and not a parent, you may only need a simple plan – proper beneficiary designations, a general financial power of attorney, and a healthcare power of attorney.
  • If you are an unmarried couple, without a power of attorney in place, you may not be able to legally step in if your partner needs someone to make medical or legal decisions for them because you are not a legal spouse or next of kin.
  • If you have children under age 18, a Will is the document that identifies your choice(s) for a Guardian and Conservator to care for them when you are gone. If you do not have this in place, the Court will make this decision for you.
  • If you leave money or property to children (or another person) with poor spending habits, no knowledge of financial planning, or creditor issues, you cannot control if your hard-earned money will be quickly wasted. Also, if someone receiving governmental benefits or assistance receives an inheritance, he or she may lose these benefits.
  • If you prefer organization, planning, control, and avoiding a “see what happens” approach, you are a candidate for an estate plan, which can allow you to control how your assets are managed, distributed, taxed, and protected.




What are the real benefits of an estate plan?


Most importantly, it can help your children, family members, and loved ones when you are not here to help them. Other benefits include:

  • Avoiding probate. Probate cost is between 3-8% of the estate’s market value. The time required for probate can be anywhere from 6 months to 2+ years (during which time accounts can be frozen, even if loved ones may need money sooner)
  • Avoiding “living probate” (conservatorship and guardianship proceedings if you become incapacitated and do not have current (not more than 2-3 years old) powers of attorney in place)
  • Identifying someone you select and trust to make decisions for you if you become incapacitated
  • Specifying who will care for your minor children if you are unable to do so
  • Carrying out charitable objectives
  • Providing instructions and care for your pets
  • Protecting assets from divorce and creditors
  • Designating end-of-life medical wishes
  • Transfering wealth to others
  • Planning for business succession
  • Minimizing tax liability (although there is no Michigan estate (death) tax and the federal estate tax allows for an exemption (in 2021) of $11.7 million per person. For a married couple, that comes to a combined exemption of $23.4 million)




Why do I need a Power of Attorney? Everyone knows what I want.


At some point during your lifetime, will you deal with a bank, realtor, need to sign a contract, etc. If you are incapacitated and unable to sign a legal document giving someone the legal authority to handle these things for you, a court will appoint someone to do so.

Also, for parents with "children" 18+ years of age (whether you see them this way or not, legally in Michigan they are now adults), you may not be able to access your child's medical records, educational records, or handle financial affairs for them without these documents giving you that power.

You need to have the legal capacity to sign these documents, therefore it is important to have them in place before incapacity or disability arises.

A general (or also referred to as financial) power of attorney, and a healthcare power of attorney, are two essential, basic, estate planning documents, that everyone over 18 years of age should have in place.




Why Kelly?


If you enjoy working with approachable and friendly people, Kelly is a fit for you. In addition, she provides prompt, professional, and thoughtful service from the start of your plan to the end. Your matter will be handled directly by Kelly and you will not be handed off to a paralegal or other support staff. Kelly strives to provide information to her clients so they will gain an understanding of how estate plan documents can help during their lifetime and GREATLY assist family and loved ones when they need to step in because of incapacity or at death. When a question comes up you always have someone willing to respond to your email, take your call, and provide an honest answer in a timely manner and if a unique situation presents itself, she works with other attorneys, financial advisors, insurance representatives, CPAs, among others to help assess the situation and provide guidance when necessary.




What is a Ladybird Deed?


This type of deed affectionately known as a "Lady Bird" deed (only available in a few states, including Michigan) is a quitclaim deed named after President Lyndon Johnson's wife, because the President was thought to have once used this type of deed to convey land to her upon his death. A Lady Bird is a type of deed that works to transfer title for your home, or other real estate, with the home remaining in your name during your lifetime, and upon your death, it avoids probate, and goes to whomever you have named as a beneficiary. Simply, it acts as a beeneficiary designation for your real property. If you use a Lady Bird deed, you maintain complete control over your property. You can refinance it, sell it, mortgage it, use it - do whatever you want with the property while you are alive - then at death, the property avoids probate and ownership is transferred to whomever is named (beneficiary) on the deed, which can be individual(s), or even a family trust.




What does the JUST THE BASICS plan accomplish?


This basic plan includes the essentials - a Will and Powers of Attorney. It is most appropriate for the individual that does not want to "fuss" too much with an estate plan, but wants to ensure they have a voice in what happens to their assets rather than having state law dictate what happens. A simAple Will provides instructions for the distribution of assets for the distribution of property at death. However, with a Will based plan, Probate (formal or informal) may be required depending on the type and value of your assets at death. Probate (a public forum) can take anywhere from 6 months to 2+ years. The cost for probate can run from 3-5% of the value of your estate. Powers of Attorney are used to allow someone that you name (your Agent) to handle your financial, property, and medical matters, in the event of your incapacity (age, illness, addiction, etc.) during your lifetime.




What does THE NEW FAMILY PLAN accomplish?


This plan is a great solution for a young family or indivual with minor child(ren) looking to have some say in the distribution of their assets and nomination of a Guardian for minor children without state law and the Court making that decision without parental input. A Will with a trust and nomination of Guardian for minor children can provide that. This type of trust (Testamentary Trust) is different from a Revocable Trust in that it is created during the probate process. This plan is a starter plan when budget might be a consideration, but protection and direction especially regarding minor children is important. It covers the bases and is a great foundational plan if you are not ready for the complexity and details of a (Revocable) Trust based plan. Powers of Attorney are incredibly important and helpful in the event of illness or incapacity to allow your Attorney-in-Fact to manage your finances and health care decisions when you are unable to do so for yourself.




What does the THE BABY BOOMER PLAN accomplish?


This plan is a good choice for individuals that have adult children that they still want to protect, may or may not need (or want) some creditor protection over the assets they will inherit, and provide some specific instructions for them. This is the plan that makes the most sense for many individuals. This is a Trust based plan which avoids the unforseen costs - both financial and emotional - of a probate proceeding, is administered privately (a court does not oversee the administration of a trust), allows for instructions regarding distribution of your assets both during your lifetime and at death, and is flexible in that it can be amended or changed during your lifetime as life changes. Powers of Attorney allow your Attorney-in-Fact manage your finances and property in the event you are unable to due to age, illness, or incapacity. The Healthcare Power of Attorey is similiar but only applies to health care matters and takes effect when it is determined (by doctors) that you are unable to make or communicate your health care decisions.




What does THE SANDWICH GENERATION PLAN accomplish?


This plan is the most comprehesive and thorough plan. It has all the benefits of the Baby Boomer Plan and the New Family Plan. This plan is for those looking to dot their Is and cross their Ts, while still providing for flexibility with our everchanging lives. There are few differences are that this is a Revocable Trust based plan, so unlike New Family Plan, your Trust provides direction and instruction regarding your assets after death and DURING YOUR LIFETIME. Also, you can create provisions within your Trust to provide income to your children after certain milestones are achieved, or at certain ages, or for their first wedding, to start a business, buy a home, etc. This plan not only includes (General/Financial and Healthcare) Powers of Attorneys for the Trustmakers, but also for those with children 18 years and older, and/or for parents. If you have children 18+, then legally they act for themselves now. In order for you to have access to their medical, financial, and even educational information, a Power of Attorney is likely to be requested. Same is true for parents that you are caring for. If older parents need your assistance and are able to manage their own affairs (not incapacited due to age, illness, etc. and do not have a Guardian appointed), having a Power of Attorney for them only makes your life easier.




When can I start?


Right now. Tomorrow. Next Week. It is as simple as completing the appropriate Questionnaire on the website and then scheduling a :30 (virtual or telephone conference) consultation to talk with Kelly, ask some general questions, and review your Questionnaire. At this meeting you will receive a recommended plan or two and the flat fee for such recommendation(s). When you decide which is right for you, you will receive an Engagement and Retainer Agreement detailing the plan, your responsibilities, and attorney responsibilities to finalize your estate plan and take the next step in planning which is defining distribution of assets and which people you want to fill various roles to help carry out your plan.





Kelly T. Braun Estate Planning Attorney - Wills and Trusts