A will provides for the distribution of property owned by you at the time of your death in a manner of your choosing, subject to certain laws preventing the disinheritance of a spouse and minor children. A will does not govern the distribution of property that passes outside your probate estate such as life insurance, joint property, or retirement benefits unless your estate is the named or default beneficiary. A will allows you to designate a guardian or a conservator for your minor child if you have survived the other parent. In your will, you may also designate whom you would like to administer your estate. A will can be amended at any time prior to death.

Trusts are a compliment to wills. Generally, you establish a trust during your lifetime. Trusts involve the transfer of your property to a trustee who manages the assets pursuant to the trust’s provisions for the benefit of one or more beneficiaries. A living (inter vivos) trust is one that is effective during your lifetime. Conversely, a testamentary trust is a provision in your will which does not become operative until your death. The provisions of the trust document will usually determine what happens to the property in the trust upon your death. A living trust may be revocable (subject to change or termination) or irrevocable, depending on the purposes you are attempting to accomplish. With a revocable trust, the creator (settlor) has access to the trust assets while alive; however, the trust assets within an irrevocable trust no longer belong to the settlor. They are owned by the trust entity and will be managed pursuant to the terms of the trust. Some basic purposes of a trust may include probate avoidance, property management, and a specific disposition prior to or after the death of a settlor. Trusts may also provide opportunities to minimize gift and estate taxes. In addition to these benefits, trusts with very specific purposes may also be appropriate given your individual needs.

Powers of attorney and patient advocate designations are documents created to give one or more persons the power to act on your behalf while you are alive. The power may be limited to a particular activity (e.g. the sale of a home) or general in its application empowering the agent (attorney in fact) to act on your behalf in a variety of situations. These situations may range from financial and property powers to medical and end-of-life decisions. A power of attorney may take effect immediately or upon the occurrence of a future event (e.g. incapacity). With a valid power of attorney and patient advocate designation, your agent can take any action permitted in the document.

Estate planning should not only take into consideration what happens to your property at your death. Oftentimes, it may be more appropriate to address the timing and structure of certain transactions during your lifetime. you may need to plan for acquisitions, sales, or concurrent ownership of real property depending on your individual needs. Deeds, easements, land contracts, leases, and joint property ownership can play in integral part in an effective estate plan.

The concurrent ownership of property between multiple people can also play a major role in your estate plan. Generally, there are four types of concurrent ownership of property in Michigan: tenancy by the entireties, joint tenancy with full rights of survivorship, joint tenancy, and tenancy in common. Depending on the circumstances and type of property, a particular form of concurrent ownership may not be applicable or may not be the most desirable form of ownership for your intended goals. You will want to have a thorough understanding of the advantages and disadvantages of the different types of concurrent ownership if you are going to own property with another person. There may be unintended consequences if the wrong type of concurrent property ownership is in place.

Beneficiary Designations are another useful tool in the estate planning process. Oftentimes, you can name or designate a particular individual or individuals to receive a particular asset such as a bank account, life insurance policy proceeds, or a retirement account. These types of designations can help to facilitate a more convenient transfer of a particular asset to the intended beneficiary or beneficiaries without the need for a longer probate proceeding.

There may be additional documents or steps that complement the options mentioned above which would further assist in meeting your estate planning goals. The more you become involved in creating your personal estate plan, the more likely your asset management and disposition goals will be met.