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Estate Planning

Estate Planning

What is estate planning?

Estate planning is developing a definite plan for the administration and disposition of your property during life and at death. That is, it involves both handling your property while you are alive and deciding what happens to that property after your death.

Estate planning involves three overall steps and the plan should be updated as major life events occur to be confident property will be transferred to the right heirs. For example, if you get married, divorced, or widowed, your plan needs to be updated. If your health or financial status changes you will need to update your plan. If you have a child you will need to update your plan. Additionally, you should periodically review the beneficiary and ownership designations in your life insurance policies, retirement plans, bank accounts, and other assets to make certain they will transfer the property according to your wishes.

The two steps are setting goals and objectives (i.e., What do you want to accomplish?), and the making of a will.

After experiencing the trauma of losing a loved one, quarreling over what the deceased would have wanted, and hunting for documents; most people would agree that it is worth spending some time and money to get their affairs in order to cut down on the confusion and uncertainty.

Most people would like to have a say in what happens to their property. An estate plan is a tool that provides some aspect of control. If you don’t make a plan, state and federal law will determine what happens to your property upon your death.

In Florida if you die intestate (without a will) the following applies based on your family situation:

If you have a surviving spouse and no lineal descendants (children or grandchildren), then the surviving spouse receives all of the estate.

If you have a surviving spouse and lineal descendants of both the surviving spouse and yourself, then the surviving spouse receives the first $60,000 of the estate, plus one-half of the rest of the estate and the lineal descendants share the remaining half.

If you have a surviving spouse and lineal descendants (one or more of which are not lineal descendants of the surviving spouse), then the surviving spouse receives one-half of the estate and the lineal descendants share the remaining half.

If you do not have a surviving spouse, but have lineal descendants, then the lineal descendants share the estate.

If you do not have a surviving spouse nor lineal descendants, then the estate goes to your surviving parents, and if none, then to your brothers or sisters or descendants of your brothers or sisters.

Your estate consists of everything you own including your home, other real estate, bank accounts, investments, retirement plans, and insurance policies. While a will is the cornerstone of an estate plan, other common transfer tools include joint tenancy with right of survivorship, gifting, beneficiary transfers, and living trusts. You may choose to use several of these tools to manage your estate.