This document provides an overview of basic estate planning tools including wills, powers of attorney, healthcare directives, trusts, and life insurance. It discusses the three main legal documents involved in estate planning - a last will and testament, power of attorney, and advanced healthcare directive. It also describes what happens if a person dies without a will, defines some common legal terms, and provides brief descriptions of term and whole life insurance.

2. BASIC ESTATE
PLANNING TOOLS

3. 3 BASIC DOCUMENTS
• LAST WILL AND TESTAMENT (WILL)
• POWER OF ATTORNEY
• ADVANCED HEALTHCARE DIRECTIVE
(HEALTH CARE PROXY AND LIVING WILL)

4. LAST WILL & TESTAMENT
• Written legal document used to distribute
assets following your death
• Allows you to designate an Executor
(Personal Representative) who will ensure
that your instructions are carried out
• Allows you to nominate a guardian and
trustee for your minor or disabled children

5. WHO CAN MAKE A WILL?
• 18 YEARS OF AGE OR OLDER
• OF SOUND MIND
• FREE FROM IMPROPER INFLUENCES
• BEST TO BE OF GOOD HEALTH & FREE
FROM EMOTIONAL STRESS

6. HOW IS A WILL MADE?
• Written, not verbal
• Signed by maker of the will
• Witnessed as provided by law

7. WHY DO YOU NEED A
WILL?
• Final instructions
• Prevent arguments
• Provide for children
• You get to make the decision, not the
State

8. WHAT HAPPENS IF YOU DIE
WITHOUT A WILL?• Intestate – Person dies without a will
• Alabama laws of intestacy provide that if the decedent (dead
person) is survived by a spouse, the following rules apply:
(a) If the decedent didn’t leave parents or children, the spouse gets
everything.
(b) If the decedent was survived by parents but not by children, the
spouse gets $100,000 and half of the balance of the decedent’s
estate. The decedent’s parents get the remaining half.
(c) If the decedent had children who are also children of the
surviving spouse, the surviving spouse gets $50,000 and one half of
the balance of the decedent’s estate. The surviving children share
the other half of the balance.
(d) If the decedent had living children that are not the children of the
surviving spouse, the surviving spouse gets one half of the estate
and the decedent’s children get the remaining half.

9. INTESTACY, continued
• If the decedent is not survived by a spouse,
the estate passes to decedent’s heirs at law
in the following order of priority:
(a) Children and their descendants;
(b)Parents;
(c)Brothers and sisters, or, if all are
deceased, nieces and nephews;
(d)Grandparents, aunts, and uncles or, if all
are deceased, to their descendants; and then
(e)The State of Alabama.

10. OVERVIEW OF PROBATE
PROCESS• Seek guidance from a lawyer to determine if
it is necessary to probate the deceased
person’s estate.
• Petition is filed with court
• Notice is given as provided by law
• Hearing is held if required
• Executor/Personal Representative is
appointed
• 6 months claim period must run
• Final Settlement

11. MISC ITEMS
• Alabama does not recognize handwritten wills
not properly witnessed (holographic wills)
• Will must be probated within 5 years of death
• Discuss final arrangements with family members
• Keep important paperwork in safe, central
location

12. TRUSTS
• Contract between Settlor and Trustee
• Settlor is the person who creates the trust
• Trustee is the person who manages the trust
• A trust allows you to plan with more details and
more control
• Reduce estate and gift taxes
• Seek advice of lawyer

13. POWER OF ATTORNEY
• Written document that allows you to give
someone else legal right to act for you
• Specific or general
• Durable power of attorney
• Delegation of Parental Authority

14. ADVANCED HEALTHCARE
DIRECTIVE
• Healthcare proxy and living will
• Healthcare proxy – allows you to designate
someone to make healthcare decisions for you if
incapacitated
• Living Will – Health care directive that spells out
your life sustaining treatment choices

15. LIFE INSURANCE
• To protect your family and loved ones especially
if you are the primary source of income
• Cannot replace a person but can help provide
financially for those you leave behind
• Two major types: Term Life and Whole Life

16. TERM LIFE
• Simplest form of life insurance
• Coverage is for a defined period of time
• Guaranteed death benefit during defined period
of time
• No cash value
• Premium is fixed for the initial period
• Premium is initially lower than other types of life
insurance

17. WHOLE LIFE
• Sometimes referred to as “permanent life
insurance”
• More expensive premiums than term life
• Different types of whole life
• Part of your premium may go toward building
cash value

18. LEGAL TERMS
• Appraisal - an expert estimate of the value of something
• Abstract - An abstract of title is the condensed history of title
to a particular parcel of real estate, consisting of a summary
of the original grant and all subsequent conveyances and
encumbrances affecting the property and a certification by the
abstractor that the history is complete and accurate.
• Conservator - a person appointed by the court to administer
the estate/financial affairs of a minor or adult individual.
• Conservatorship - A legal concept where a conservator is
appointed by a judge to manage the financial affairs of
another due to physical or mental limitations.
• Decedent - a person who has died
• Guardian - a person appointed by the court to manage the
personal affairs of a minor or adult individual

19. LEGAL TERMS
• Guardianship - A legal concept where a guardian is appointed by a judge to
manage the personal affairs of another due to physical or mental limitations.
• Holographic Will - handwritten will not properly witnessed (not recognized in
Alabama)
• Intestate - a person who dies without a will
• Joint with right of survivorship (JWROS) - A joint tenancy with right of
survivorship is a type of concurrent estate in which co-owners have a right
of survivorship, meaning that if one owner dies, that owner's interest in the
property will pass to the surviving owner or owners by operation of law, and
avoiding probate.
• Settlor - person who creates a trust
• Survey - to determine the form, extent, and position of a tract of land by
taking linear and angular measurements. A land survey includes a clear
measurement and definition of a property's boundaries. The surveyor uses
the property's legal description as well as benchmarks on the ground to plot
out the exact dimensions and size of the piece of property being transferred.