Even if you don't own much, you still need a plan for what happens to it after you die. An estate plan can also include planning for how to handle financial and medical decisions if you cannot do so for yourself.
Writing your will
Your will is the cornerstone for ensuring all your assets go to the people or organizations you choose. In addition to property distribution, many people name:
- A guardian for their minor children
- An executor for the estate
If you don't have a will when you die, your estate will be distributed according to Minnesota's intestacy laws. In general, your spouse gets everything if you are married, unless one of you has children by someone else.
Transferring assets outside probate
Probate is the public court process for winding down your estate, which many people would like to avoid. Completely bypassing probate may not be an option, but you can take steps to minimize your probatable assets:
- Designate beneficiaries—Any financial account with named beneficiaries automatically goes to those people when you die.
- Transfer assets before you die—You will need to consider the tax implications of this option for the recipients.
Under Minnesota statute, your heirs may be able to claim your estate by filing an Affidavit for Collection of Personal Property form if your estate is under $50,000 and you do not own any real property.
Designating an agent to handle your finances
Bills and other financial decisions do not stop when you are seriously ill or injured. You can name an agent to handle these things for you in a document called a durable power of attorney.
You can specify when your agent should take over decisions (either a date or an event, such as a coma). You can also limit what actions your agent may take and for what accounts.
Making end-of-life health care decisions
If you have specific wishes regarding life-sustaining medical treatments, you may want to document them in a health care directive. This combination living will and power of attorney for health care lets you specify:
- An agent to medical decisions for you
- What types of treatment you want
- How your agent should make decisions
- Whether you want to be an organ donor
You can even document your wishes for your funeral. If you do make your own funeral arrangements, you may want to consider setting up a special trust or bank account designated to pay for it.
Other estate considerations
Depending on your circumstances, you may need additional arrangements to ensure the orderly dissolution of your estate, such as:
- Business survival—If you own or co-own a business, you need a plan for transferring ownership, or the business could die with you.
- Life insurance—If your estate is not large enough to pay for your dependent's needs, a good life insurance policy can help.
Ensuring your plan is legal
Your situation is unique and estate law can be complicated. It's worth talking with a Minnesota estate planning attorney to be sure your documents are properly executed and binding.