You have collected on a personal injury judgment or have settled your case. It is a relief to be finished. You are certainly glad to have the money in hand. Perhaps some of it will be used to pay expenses you incurred. You might be lucky enough to have money leftover. But you are wondering how the money you received affects your estate plan. Or perhaps it is time now to put an estate plan in place. An estate planning attorney can consult with you on what to do next. Below are some basic points to consider.
What is an estate plan?
Part of your plan is a roadmap for where you want your assets to go when you are gone. It might also address who will make decisions for you if you become incapacitated. Doing so can avoid a later need for a costly guardianship or conservatorship proceeding. There are opportunities to plan for care of children also. This can involve both financial and basic care decisions. There are a number of techniques that can be used. The most common are the last will and testament, healthcare power of attorney, general durable power of attorney, living will, limited liability company (LLC), and trusts. Your estate plan will utilize these tools or others to distribute your assets properly and efficiently and to make healthcare and financial decisions. What you need will depend on a variety of factors.
Is it time to revisit my estate plan?
Your wills and estates lawyer can answer this for you and it is time to at least ask. The money you have collected increases your overall worth. This increase might have state and Federal tax implications that can be addressed with planning. Even if your estate is not likely to be taxable, other considerations might be relevant. Probate avoidance is a common one. Most attorneys suggest revisiting your estate plan periodically anyway.
What if I don’t have an estate plan?
Then it is good that your personal injury award has prompted you to think about it. Not having estate planning documents in place can be a problem. Intestacy laws will control how your assets are distributed. You will have missed your chance to decide for yourself. Some individuals have other considerations. Efficiency in tax planning and probate administration should be considered along with unique family circumstances. Parents with minor children often want to address how their children will be taken care of. All of this and your particular concerns can be discussed at an initial consultation.
Estate planning is not one size fits all and any plan should be reviewed from time to time. Receiving a personal injury award is an excellent time to look at or create your estate plan.