News & Thought Leadership from Sulloway & Hollis

February 26, 2024

Beginner’s Guide to Estate Planning

Beginner’s Guide to Estate Planning

What Is an Estate Plan?  An estate plan ensures that your affairs are handled exactly the way you want during your life and after your passing.  Although most estate plans have a few things in common, your plan is really about you: your vision, your family, and your goals.  A good estate planning attorney will carefully listen to your story and work with you to develop a plan for your future.

What Should You Expect at the First Meeting?  Your lawyer will want to ask you some questions about your family, your assets, and your objectives.  Be prepared to talk about your friends and family; you should work with your lawyer to determine the people who should inherit your estate, as well as the right people to manage your affairs in case of death or incapacity.  You’ll also want to talk about the things that you own. If possible, bring a summary of your assets to make your meeting with your estate planner more efficient.  Bring a copy of your deed, recent financial statements, and copies of any old estate planning documents.  When the discussion turns to your objectives, you’ll want to lay everything out on the table: do you have concerns about the future of your business? Does your child have any special needs that would impact his or her ability to receive or manage an inheritance? Do you support local charities?  Each of these considerations (and many more!) will be critical in shaping your plan.

Do You Need a Trust?  The short answer is: it depends.  A trust can help individuals and families to avoid probate and provide for a smooth transition in asset management.  Certain specialized trusts will help to accomplish other objectives like asset protection or lowering your anticipated estate tax bill.  Trusts are extremely versatile, but they’re not for everyone: make sure you and your lawyer have a frank discussion about the pros and cons before choosing to include a trust as part of your plan.

Do You Need Powers of Attorney? Yes! In New Hampshire, there are two different powers of attorney: one for financial decisions, and another for medical decisions.  These powers of attorney are “during life” documents; they appoint a person to act on your behalf in the event you were to become incapacitated.  If you were to lose capacity without having signed a power of attorney, your loved ones would have to go to court and seek appointment to become your legal guardian.  That process can be time-consuming and expensive; it’s far better to be prepared and to have your appointments already in place.

How to Cut through the Legalese?  Ask your lawyer for a plain English summary of your documents.  Some lawyers will prepare this summary as part of the project and send it to you along with drafts of your documents; others prefer to have a meeting to discuss the key provisions.  At the end of the day, this is your estate plan, and your lawyer should be able to provide you with clear answers and explanations.

What Should You Expect at the Signing Meeting?  To be valid under New Hampshire law, your documents must be signed in accordance with certain rules and formalities.  There should be two disinterested witnesses and a public notary at the signing meeting.  I am a notary, so are many other estate planners—ask your lawyer if you need to provide the notary and/or witnesses.  Your lawyer will ask you to sign your name several times and then conclude the signing ceremony by asking you some questions in front of the witnesses. I like to go over each section of your plan with you before we bring the witnesses into the room—this gives you the time and space to make sure that everything is exactly to your liking, and to ask any last-minute questions, without an audience.

What Do You Need to Do Post-Signing?  It’s very possible that your lawyer will recommend that you take certain steps after signing.  If you decided to set up a trust, you may need to make some changes to your financial accounts, retitle your vehicles, change your life insurance beneficiaries, etc.  At the signing meeting, please make sure you confirm with your lawyer whether any further action is required.  Even if no immediate action is necessary, it’s generally a good idea to revisit your estate plan every 3-5 years (or sooner, if you go through a major life event).

Timothy A. Sorenson is a member at Sulloway & Hollis and works with the firm’s Tax, Trusts, and Estates Group.  He can be reached at (603) 223-2895 or tsorenson@sulloway.com.