Create a last will and testament: A will is the cornerstone of any estate plan, allowing you to specify who will inherit your assets. In Florida, a valid will must be signed by the testator (the person making the will) in the presence of two witnesses. Make sure you update your will regularly, especially after major life events such as marriage, divorce or the birth of a child.
Take advantage of Florida’s Homestead Exemption: Florida offers unique homestead protections that prevent your primary residence from being seized by creditors in most cases. This homestead exemption also limits how your home can be passed to beneficiaries. Understanding how these protections work in estate planning can help protect your home for your heirs.
Consider a revocable living trust: Florida’s probate process can be time-consuming, so many individuals choose to place their assets in a revocable living trust. A trust allows your assets to bypass probate and be distributed to your beneficiaries more quickly. Since it’s revocable, you can amend or revoke the trust at any time during your life.
Name a durable power of attorney: A durable power of attorney (POA) designates someone to manage your financial and legal affairs if you become incapacitated. In Florida, the principal and two witnesses must sign the POA, and it has to be notarized. Without this in place, a court may appoint a guardian to manage your affairs, which can be a lengthy and expensive process.
Establish a healthcare directive: A healthcare directive outlines your medical preferences in case you become unable to make decisions yourself. In Florida, you can also name a healthcare surrogate, a trusted individual who will make medical decisions on your behalf. This ensures your healthcare preferences are respected, even when you can’t communicate them.
Update beneficiary designations: Some assets, such as retirement accounts and life insurance policies, pass directly to beneficiaries outside of the probate process. Review and update beneficiary designations regularly to make sure they reflect your current wishes.
Plan for estate taxes and potential costs: While Florida does not have a state estate tax, federal estate taxes may apply if your estate exceeds the federal exemption threshold. Be aware of any potential tax liabilities and plan accordingly to minimize the tax burden on your heirs.