Estate planning has a branding problem. The word "estate" makes people picture a mansion, so most families assume this is for somebody else. It is not. If you own a home, have a retirement account, or have anyone who depends on you, this is about you.
What is an estate?
Your estate is everything you have accumulated: your home, retirement accounts, savings, investments, business interests, vehicles, and personal belongings. All of it.
There is a second half people forget. Your legacy is part of your estate too. Your work ethic, your values, the causes you cared about, the way you want your family to treat each other. Those get passed down as surely as the assets do, and a good plan can be deliberate about them instead of leaving them to chance.
What is estate planning?
Strip away the terminology and estate planning does three things.
- It manages your assets while you are alive and well, and keeps them managed the way you want if you become unable to manage them yourself.
- It gets your assets to the people you choose, in the way you choose, after you pass away.
- It leaves the legacy you intended rather than the one that happens by default.
That middle item, the incapacity piece, is the one nobody expects. Most people think estate planning is about death. In practice, the documents that get used most are the ones that matter while you are still very much alive.
Who needs an estate plan?
Everyone. And that is not a sales line, it is arithmetic.
Without a plan, the State of Michigan has one for you. State law decides who receives your assets and when. State law decides who has authority to make financial and medical decisions for you if you cannot make them yourself. And your family goes to probate court to sort it out, making hard decisions with no guidance from you, during the worst weeks of their lives.
The question was never whether you have a plan. It is whether you wrote it or Lansing did.
When should you plan?
Now, while you can, before the plan is needed rather than after.
Everything in estate planning gets harder with time and easier with lead time. The Medicaid rules that protect your home from long-term care costs look back five years, so the clock has to start well before anyone needs care. And if you become incapacitated, your options do not shrink, they disappear. You can no longer sign the documents that would have helped, and your family is left making the decisions you should have made for yourself.
The right time to plan is as soon as possible, and ideally a little before that.
What a good plan actually gets you
- Your minor children are raised by the people you chose, not the people a judge chose.
- You keep control of your assets if you become incapacitated.
- What you own goes to who you want, how you want, at the lowest cost and with the fewest fees.
- Your assets are protected from creditors, lawsuits, and long-term care costs.
- Your financial affairs and your family's business stay private instead of becoming a public court record.
- Your children's inheritances are protected from their own divorces, creditors, and hard seasons.
- Estate, income, and gift taxes are reduced where the law allows it.
Starting from zero?
That is the easiest place to start from. Tell us about your family and we will tell you what you actually need. No cost, no paperwork, no pressure.
The estate planner's toolbox
Here is what each tool is and what it is for. You will not need every one of them.
Last Will and Testament
A will says who gets what and, if you have minor children, who raises them. Without your own will, Michigan distributes your assets by formula and a court decides who has authority over your children. That could easily be someone you would never have chosen.
What a will does not do is avoid probate. A will is the instruction sheet you hand the probate court, not a way around it.
Durable Powers of Attorney
These let you name the people who make decisions for you if you cannot. A healthcare power of attorney covers medical decisions. A durable financial power of attorney covers financial and legal ones.
Not all powers of attorney are equal. Many are written too narrowly to do what a family actually needs in a crisis, particularly around long-term care planning. It is worth having yours read by someone who knows what to look for.
Advance Directives
An advance healthcare directive, often called a living will, records what treatment you do and do not want in an end-of-life situation. It is a gift to your family more than to you. It means nobody has to guess, and nobody has to carry the weight of having decided.
HIPAA Authorization
Federal privacy law stops medical providers from sharing your health information, including with your own family. A HIPAA authorization names the people who are allowed to be told. It is a small document that prevents a very specific nightmare: standing in a hospital being told nobody can tell you anything.
Trusts
There are many kinds of trusts, and they do genuinely different jobs. Two matter most for Michigan families.
A living trust, also called a revocable trust, lets you keep complete control of your assets while you are alive, provides direction if you become incapacitated, and passes everything to your beneficiaries without probate. It is the workhorse of estate planning. What it does not do is protect assets from creditors, lawsuits, or the cost of long-term care, because everything in it is still yours.
An asset protection trust does everything a living trust does and adds the protection. Assets inside it are shielded from your creditors and from long-term care costs, and shielded for your beneficiaries from their creditors, divorces, and financial trouble. The trade-off is that you give up some control, and it has to be set up well before it is needed. If protecting assets matters to you, this is the conversation to have.
The step that decides whether any of it works
A trust is a safe. Signing the paperwork builds the safe. Funding it is putting your things inside.
An unfunded trust is worse than no trust, because your family believes they are protected right up until they find themselves in probate court anyway. It happens constantly, and usually for a mundane reason: the attorney handed over a binder and a to-do list, and life got in the way. We wrote about what that looks like.
We handle funding as part of every plan. We go to the bank, retitle the accounts, file the Lady Bird Deed on the house, and update the beneficiary designations. Since 2012 we have protected more than $2 billion in assets for over 2,400 Michigan families, and you will not leave our office with homework.
Where to go next
If you want to see the specific ways plans go wrong, read the top ten estate planning mistakes we see. If long-term care is the thing keeping you up, start with the Michigan Medicaid guide. And if you would rather just ask someone, that is what the call is for.
One note. This guide is general information about Michigan estate planning, not legal advice for your situation. What your family needs depends on your circumstances, which is exactly what a free call is for.
