The Importance of Estate Planning

When you die, you will leave behind possessions, money and other assets. An estate plan can help you decide how to give these things away. It can also minimize taxes, attorney's fees and court costs. Many people avoid putting together an estate plan because they think they do not own enough, it is too expensive or complicated, or they will have plenty of time to do it later.

Health Care Directives

Health Care Directives are a crucial part of an estate plan and allow individuals to express their healthcare wishes and appoint someone to make medical decisions for them in the event that they become incapacitated. They also help reduce confusion and disagreement among family members about what a person would want to happen. Additionally, they can save loved ones from having to decide on behalf of an individual in a time of crisis or grief.

A health care directive is a written statement that outlines your specific medical wishes in the event you lose capacity. This includes defining what types of life-sustaining treatment you would or wouldn’t like, such as breathing machines and feeding tubes. It can also name a health care agent (also known as a health care proxy) to make those decisions on your behalf and specify who you want to be informed of your decisions. The type of health care directive you need depends on whether or not you believe that you might become incapacitated at some point in the future and it varies from state to state.

Most states require that a health care directive be in writing and signed by two witnesses. It is also important that your healthcare proxies and other health care professionals know where these documents are located and that they understand what they contain. Additionally, it is a good idea to review these documents on a regular basis and after any significant changes in your health or circumstances occur.

Although creating a Health Care Directive may be difficult to think about, doing so can help you avoid unnecessary suffering and give your family peace of mind knowing that they will have clear instructions on what kind of medical care you would like to receive in the event of a serious illness or injury. It can also help you avoid the need for a conservatorship or guardianship, which are complicated and costly court proceedings. A Health Care Directive is something that everyone should have in place and it can be combined with a Power of Attorney and Trusts to create a comprehensive estate plan.

Power of Attorney

A Power of Attorney is a legal document that allows a principal to formally give someone else, also known as an agent, the power to make decisions on their behalf in case they become incapacitated. This can happen due to an accident, illness or decline in mental health, and it may be a time when the individual’s wishes are not clear. 

Koestner & Shahon can help you determine what type is appropriate for your situation. One of the most common types of Power of Attorney is a general power of attorney that covers all financial matters, including day to day transactions such as bank accounts and bills. This is often combined with a healthcare proxy to cover medical issues in the event of incapacity.

In some cases, a person may only want to give their agent powers over specific assets or transactions. In these situations, a springing Power of Attorney can be used. This only gives the agent power to act when certain conditions are met, such as a physician declaring you incompetent.

It is crucial to choose someone who you trust to represent you and your interests well. The agent is legally obligated to follow your instructions, so it is vital that they understand and honor your wishes. You should consider appointing more than one agent, and you should clearly define the powers that you are granting to avoid confusion or conflict.

Those who die without a will or estate plan can face many issues that their family must resolve, including disputes over the division of assets. These disputes can result in a lengthy legal process and decisions made by the court that may not align with your desires. Estate planning includes a will and Koestner & Shahon will help you with that. It also includes strategies like setting up trusts or making charitable donations to limit taxes and ensure accuracy of distribution upon death.

We can help you to create a complete estate plan to protect your rights and provide for your family after you are gone. Contact us to get started.


The goal of estate planning is to ensure that your assets are transferred exactly how you want them to be, and a trust can help with this. Trusts can also be used to manage tax consequences and for long term care planning.

Some of the advantages of trusts include:

Avoiding probate. Most types of trusts allow you to avoid the probate process, which can be lengthy and costly. Instead, the trustee of the trust will administer the estate according to your instructions.

A GRAT (grantory rate appreciation trust). This is a type of irrevocable trust that helps reduce the estate taxes for beneficiaries. You contribute assets into the trust for a specified period of time and receive an annuity payment based on their original value, then when the term expires, the remaining value passes to your beneficiaries without any gift tax liability.

Trusts are often used for specialized situations such as family-run businesses, real estate, and other unique assets. It is important to speak with a qualified financial professional about your specific situation to determine what kind of trust may be appropriate for you.

Creating trusts can be expensive and complicated, but it can save your loved ones time, money, and stress in the future. It can also provide a sense of peace of mind knowing your wishes are well documented.

Some people may be hesitant to set up a trust because they assume they must be wealthy to justify the costs, but the truth is that everyone should consider setting up a trust. The most common reasons are to plan for incapacity, ensure that your assets go to the correct people, and to reduce taxes. A simple living revocable trust can accomplish most of these goals, but there are many other kinds of trusts that might be useful depending on your specific situation and financial goals.

Beneficiary Designations

Many people are surprised to learn that their will does not control who receives all of their assets when they die. Instead, much of this depends on the beneficiary designations they have put on the various accounts and insurance policies they own. Most financial companies allow you to fill out forms indicating who should inherit their assets upon your death. Common examples include life insurance policies, retirement accounts (e.g. 401(k)s, IRAs), and annuities. These assets typically pass directly to the beneficiaries you designate, bypassing your will and any trusts you may have created.

Beneficiary designations can be revocable or irrevocable. Revocable designations can be changed as your circumstances change, but irrevocable designations generally cannot be amended. It is important to consult a trusted financial advisor when considering which type of designation to use.

Whether the assets are revocable or not, it is important to consider how your beneficiary designations might affect tax consequences for your beneficiaries. Koestner & Shahon can help you determine the best way to structure your assets and beneficiary designations to minimize the potential for unintended tax burdens.

It is also important to review your beneficiary designations periodically, particularly after significant life events. For example, the death of a loved one, marriage or divorce, birth or adoption, and changes in your health and family situation should trigger a review to ensure that the asset distributions reflect your current wishes and circumstances.

In addition to reviewing and updating, it is also a good idea to coordinate your beneficiary designations with your estate plan. For example, if you intend to leave your non-retirement assets in a trust, it is often better to coordinate your beneficiary designations so that the trust is designated as the primary beneficiary or retitled as the TOD (transfer on death) or POD (pay on death) account rather than the individual beneficiaries.

Finally, be sure to include complete and accurate information on your beneficiary designation forms. Incomplete or inaccurate information can delay the process of distributing assets and can even lead to litigation. Incomplete or inaccurate beneficiary information can also result in unintended tax consequences for your beneficiaries. We recommend that you consult a trusted financial advisor like Koestner & Shahon  before making changes to your beneficiary designations.

When you die, you will leave behind possessions, money and other assets. An estate plan can help you decide how to give these things away. It can also minimize taxes, attorney's fees and court costs. Many people avoid putting together an estate plan because they think they do not own enough, it is too expensive or…