What is Estate planning?
Estate planning is deciding who will get your assets, estate, and personal belongings upon death. This includes deciding how much of your assets or property you want to give to each beneficiary. While planning your estate, you can also name the person who’ll manage your resources and support and can have power of attorney both financially and health-wise.
This person can make decisions on your behalf and is ultimately responsible for taking care of your assets. One can plan an Estate with the help of an attorney who specializes in Estate law and has experience doing Estate planning. Now, let’s understand some technical terms of estate planning that you should know.
Technical terms related to estate planning that you should know
Technical terms one should understand while opting for estate planning include:
This refers to all the inventory, assets, properties, and other personal belongings, such as bank accounts, insurance, and financial investments, that a person has entitled to own at the time of his passing or incapacitation.
A person assigned by the signer is known as Executor. He will be responsible for executing the instructions written in the will. As well as managing the assets and properties, the Executor was responsible for distributing them to the beneficiaries.
This person or entity receives the assets or properties mentioned in the will or trust.
Will as important terms
Will is a legal document that declares how one wants personal belongings, properties, and assets to be distributed. It also specifies to whom after their demise.
And the list of important technical terms of estate planning will go as follows:
Trusts are legal entities that will assume ownership of or own some assets after a specific triggering event. A trust involves information on how investments in the trust should be handled and distributed.
The person signing the drafted will and transferring their property and assets is known as Testator.
A person or institution is responsible for managing and distributing the assets per the trust’s instructions.
A Grantor is a person transferring his estate through a trust.
Probate is the legal process by which a probate court distributes the assets and the properties of the estate of a deceased according to state laws.
This is a document in which a person expresses his wishes regarding medical treatment in case of incapacitation. It acts as medical power of attorney.
He had not made a legal and valid will before his death.
One signs a legal document and delivers regarding property ownership or legal rights.
It is a legal arrangement that allows someone to give their assets to a trust while they’re still alive but also allows them control over these assets.
A testamentary trust is a kind of legal arrangement that takes place upon the death of an individual.
A person legally responsible for caring for someone who is either a minor or has some disability can’t take care of himself. You can appoint a Guardian for your children or pets in your estate planning documents.
It refers to passing on assets and properties from generation to generation. Generally, this happens after the death of the person.
A person unable to manage his affairs is known as incapacitated.
Power of Attorney
Power of Attorney refers to a person or an agent you can assign to act on your behalf. This gives the person the legal authority to manage your finances, property, real estate, or any other financial transaction on your behalf. This type of PoA is revocable till the person who chooses the PoA is mentally and physically capable of doing so.
This is a person responsible for managing the assets for the benefit of another person and who himself gets no help from the Management of the assets.
Through this article, you will become more aware of the technical terms of estate planning that you should know, and thus you will become more familiar with the terms and meanings of these technical terms.