Estate Planning: 12 Things to Do Before You Die in New York

Estate planning is a crucial step in securing the future of your loved ones and ensuring that your assets are distributed according to your wishes. While it may seem overwhelming, following a structured approach can make the process manageable. Whether you have a large estate or modest assets, taking the right steps is essential for protecting your legacy. Below, we outline 12 things you must do before you die to ensure a sound estate plan in New York.

1. Create a Comprehensive Will

The foundation of any estate plan is a comprehensive will. In New York, a will allows you to designate how your assets will be distributed and appoint an executor to oversee the process. Without a will, the state will distribute your assets according to intestate succession laws, which may not reflect your wishes. Ensure your will is updated regularly to account for any changes in your assets or family dynamics.

2. Establish a Trust (If Applicable)

If you have significant assets, establishing a trust may be beneficial. A trust allows you to transfer assets to a trustee, who manages them for the benefit of your beneficiaries. Trusts can help you avoid probate, reduce estate taxes, and provide greater control over the distribution of your assets. In New York, there are various types of trusts, including revocable living trusts and irrevocable trusts. Each has its own benefits depending on your estate planning goals.

Types of Trusts:

• Revocable Living Trust
• Irrevocable Trust
• Special Needs Trust

3. Appoint an Executor and Successor Executors

The executor of your estate will be responsible for carrying out the terms of your will and managing the probate process. In New York, it is important to appoint a trustworthy executor who can handle these duties. Also, naming a successor executor ensures a backup in case the primary executor cannot serve. Clearly outline their responsibilities to avoid any confusion during probate.

4. Designate Beneficiaries

Make sure all your accounts, such as life insurance policies, retirement plans, and bank accounts, have designated beneficiaries. Beneficiary designations allow these assets to pass directly to your heirs without going through probate. Regularly review and update these designations, especially after major life events like marriage, divorce, or the birth of a child.

5. Draft a Durable Power of Attorney

A durable power of attorney (POA) grants someone the authority to manage your financial and legal affairs if you become incapacitated. In New York, a durable POA remains in effect even if you lose mental capacity. Choosing a trusted individual as your agent ensures that your finances are in good hands if you are unable to make decisions on your own.

6. Establish a Healthcare Proxy

A healthcare proxy allows you to appoint someone to make medical decisions on your behalf if you cannot do so. This document is crucial for ensuring that your healthcare preferences are respected in the event of an emergency. In New York, having a healthcare proxy in place is important, especially if you have specific wishes regarding your medical care.

7. Create a Living Will

A living will outline your end-of-life care preferences, including life-sustaining treatment decisions. This document guides your healthcare proxy and medical providers if you are in a terminal condition or permanently unconscious. By creating a living will, you can ensure that your wishes are honored and your family is not burdened with making difficult decisions on your behalf.

8. Plan for Digital Assets

In today’s digital age, estate planning goes beyond physical assets. Digital assets, such as online accounts, social media profiles, and digital currency, should be addressed in your estate plan. Please make a list of your digital assets and provide instructions for accessing them. You may want to appoint a digital executor who will manage your online presence after your passing.

9. Address Estate Taxes

Estates valued above a certain threshold in New York are subject to state estate taxes. As of 2024, the New York estate tax exemption is approximately $6.58 million. However, if your estate exceeds this amount, it will be taxed at rates ranging from 3.06% to 16%. Proper estate planning can help minimize estate taxes, allowing you to preserve more of your wealth for your beneficiaries. Consider gifting strategies or trusts to reduce the taxable value of your estate.

10. Plan for Minor Children

If you have minor children, it is critical to designate a guardian in your will. This ensures that your children will be cared for by someone you trust in the event of your death. Without a designated guardian, the court will decide who will take custody of your children. You may also want to set up a trust to manage assets for your children’s benefit until they reach a specified age.

11. Update Your Plan Regularly

Estate planning is not a one-time event. Life changes, such as the birth of a child, marriage, divorce, or a significant increase in assets, require updating your estate plan. In New York, reviewing your estate plan every few years is advisable to ensure that it reflects your current wishes. Regular updates will prevent potential disputes and ensure that your assets are distributed according to your intentions.

12. Consult with an Estate Planning Attorney

Estate planning can be complex, and New York’s laws have unique requirements and regulations. Working with an experienced estate planning attorney can help you navigate the legal process, avoid common mistakes, and ensure that your plan is legally sound. An attorney can also assist with creating trusts, powers of attorney, and other estate planning documents tailored to your specific needs.

Why You Need an Attorney:

• Ensure compliance with New York State Law
• Minimize estate taxes and legal challenges
• Create customized documents that reflect your wishes

Conclusion

Planning your estate is a vital step in protecting your assets and securing your family’s future. By taking these 12 essential steps, you can create a comprehensive estate plan that addresses all aspects of your financial, legal, and healthcare needs. Whether you need to draft a will, establish a trust, or designate beneficiaries, working with an estate planning attorney is important to ensure that your plan complies with New York state laws. Start planning today to provide peace of mind for yourself and your loved ones.