This newsletter discusses common questions on estate planning and what is involved with this process. Estate planning documents provide for your family after your death or disability. The goal in using such documents is to allow your chosen beneficiaries to receive your property in a way which maximizes the benefits to them. If you do not have your own estate plan, the state of Arkansas will supply one for you. Rarely will the state laws result in property passing in the manner which you desire (for instance if the husband dies most of the property that is not held jointly will go to the children, not the wife).   Only through a properly prepared estate plan can you name the persons you want to serve as trustee and guardian for your children. There are several documents used to create an estate plan and they are as follows:

Will. This instrument allows you to designate the the Persona that you want to probate your assets; the people that you want your assets to go to; and the guardian of your minor children. The portion of your assets controlled by your Will is called the probate estate. It consists of assets which you own at the time of your death and are in your name alone. You may change your Will at any time. It takes effect only at your death.

Trusts. A trust is an arrangement where you transfer property to a trustee or trustees to manage for the benefit of your beneficiaries. The transferor of the property or grantors can also be the trustee (in other words you and your wife can transfer the assets into the trust and have complete control over these assets as the trustee). The trust also allows for you to state when your children with get their portion of the estate (such as 1/3 when they are 21, 1/3 when they are 25 and the reminder when they reach 30). The assets held by a revocable trust do not go through probate.

Durable Power of Attorney. You may use a durable power of attorney to designate another person to manage your financial affairs during your lifetime if you are unable to do so. Each spouse can designate the other spouse to act in this capacity. This is done so that a guardianship with all of its expense and public accessibility does not have to be set up for a person should they become physically or mentally incapacitated.

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