Important Estate Planning Terms to Know
June 15, 2022
Recently, there has been increased awareness about estate planning for both younger and older adults. Creating necessary estate planning documents gives you peace of mind and ensures that you get your estate, financial, and end-of-life plans in order. Also, establishing an estate plan helps provide detailed instructions about how your final affairs should be settled or assets distributed when you die.
Unfortunately, many American adults often neglect or procrastinate creating their estate plans due to their limited – or lack of – knowledge about the estate planning process. According to a 2022 Wills and Estate Planning Study by the Caring website, about 40% of Americans without a will or estate plan don't have one because "they haven't gotten around to it."
At Caleb Bland Law, PLLC, we are dedicated to providing outstanding legal services and knowledgeable guidance to clients in estate planning-related matters. Our experienced Kentucky estate planning attorney can enlighten you about the state's estate planning process, explain important estate planning terms to know, and help you navigate crucial decisions. We proudly serve clients across Elizabethtown, Louisville, Hodgenville, Bardstown, Radcliff, and Nelson County, Kentucky.
Why Estate Planning Is Important
Estate planning involves creating a detailed plan in advance regarding who will receive your assets and how they should be transferred to inheritors or disposed of after your demise or sudden incapacitation. Estate planning is important because it can help you achieve the following:
Prepare for future uncertainties.
Protect your assets and property.
Make adequate provisions for your surviving loved ones.
Name your personal representative or trustee.
Give you absolute control about who inherits certain assets.
Make suitable provisions for minor children and pets.
Help reduce the amount of taxes on your estate.
Protect your assets from frivolous lawsuits and creditors.
Help inheritors reduce or avoid estate, gift, and inheritance taxes.
Mitigate conflicts or disputes among family members over asset distribution.
Help your estate and loved ones avoid the time-consuming and expensive probate process.
Ensure that you do not die "intestate" (without a will).
An experienced lawyer can help you understand how estate planning works in Kentucky and some key terms you need to know.
Important Terms to Know
To understand the Kentucky estate planning process, it is important that you know the terms that are used. Below are some common terms used in estate planning matters:
Estate: The total amount of property, assets, debts, and liabilities accumulated by a person at the time of their death
Decedent: An individual who has died; a dead or deceased person
Will: A will – or last will and testament – is a legal document that provides detailed instructions about an individual's legal and financial wishes, how they want their estate to be administered, or how assets should be distributed to inheritors when they die.
Testator: A person who makes and executes a last will and testament
Trust: A trust is a fiduciary relationship in which a person (grantor or trustor) appoints someone else (trustee or successor trustee) to hold assets on behalf of a beneficiary.
Trust Property: Trust property includes assets placed in a trust for the benefit of a designated beneficiary. The trustee will manage and distribute trust assets to beneficiaries upon the trustor's death or sudden incapacitation.
Beneficiary: A person who receives benefits of property from an estate, will, trust, or other legal contracts
Intestate: A person is said to have died intestate if he or she dies without a valid will. Therefore, the decedent's estate will be distributed to heirs according to Kentucky's intestate succession laws.
Probate: Probate is a court-supervised process that is needed to determine whether a will is valid and to settle the decedent's final affairs. It involves identifying, collecting, and evaluating assets, paying debts and taxes, and transferring remaining assets to rightful inheritors (beneficiaries and heirs).
Executor: A person named in a will – or appointed by the probate court – to administer the deceased person's estate according to the provisions of the last will and testament
Advance Directive: An advance directive is a legal document that allows a person (the principal) to make decisions, in advance, about their favored medical treatments and procedures should they become incapacitated, critically ill, disabled, or otherwise unable to make such medical decisions by themselves.
Power of Attorney: A power of attorney is a legal document that gives a person (the agent or attorney-in-fact) the legal duty, authority, and power to act on the principal's behalf in financial, legal, tax, property, and healthcare matters.
Guardianship: A guardianship is a legal relationship established by state law whereby a court appoints a capable adult to act as the legal guardian of a minor child or disabled adult. The legal guardian will have the legal duty, right, and power to make personal and/or financial decisions for their ward.
Conservatorship: A conservatorship is a legal relationship between a capable adult (conservator) and a person determined to be legally disabled. The conservator will help in managing the financial affairs of the incapacitated adult. In Kentucky, conservatorship only deals with financial affairs.
Skilled & Compassionate Counsel
Creating an estate plan in Kentucky requires getting detailed legal counsel and advocacy to navigate key decisions and ensure that all estate planning documents are valid. At Caleb Bland Law, PLLC, we have the diligence, resources, and knowledge to assist and guide individuals and families through the complexities of estate planning.
As your legal counsel, we can enlighten you about how estate planning works, explore your possible legal options, and determine the right estate plan that best fits you and your family's needs. Together, we can help draft important estate planning documents, including wills, trusts, advanced directives, and powers of attorney. We will work intelligently to address your various needs and concerns, help you prepare for life's uncertainties, and ultimately achieve peace of mind.
Contact Caleb Bland Law, PLLC today to schedule a simple case assessment with an experienced estate planning attorney. We proudly serve clients across Elizabethtown, Hodgenville, Radcliff, Bardstown, Louisville, and Breckinridge County, Kentucky.