With regular exercise and a smart diet, we know that we increase our overall health while reducing the risk of chronic disease. Many of us take for granted the uncertainty of our life span. During our most prosperous, busy and enjoyable years (whether the child-rearing years or the golden years), we commonly find it unfathomable that something tragic or untimely might happen.

Even if you have not recently experienced a recent health crisis or major life event such as a new state residency, change in marital status, or birth of a new family member, your Last Will and Testament (and other associated documents) might still very well be in need of review to ensure compliance with the ever-changing local and federal laws. For example, the federal estate tax exemption has swung from no estate tax in 2010 to the current exemption of $5 million which is set to be reduced to $1 million in 2013 unless new legislation is passed. Additionally, a new Georgia Trust Code was enacted in 2010.

Estate planning is an essential part to putting your personal, medical and financial affairs in order. One need not be affluent to require estate planning. Other important reasons include:

To have your medical and financial affairs in order during life and at death; To protect your estate in the event that you become disabled or incapacitated; To plan for the future of minor or disabled children; or To ease the probate process for your heirs.

Under Georgia law, a well-developed estate plan is comprised of a Last Will and Testament, an Advance Healthcare Directive, a Durable Power of Attorney, and possibly a Revocable Living Trust.

The Last Will and Testament governs the disposition of your property – who gets what, when and how. However, a Will only governs what is known as your probate property. Probate property is that which is titled only in your own name or jointly with one or more other persons as “tenants in common” (for example bank accounts, brokerage accounts and real estate). Non-probate property is not governed by your Will and typically includes life insurance and retirement accounts that are controlled by “designation of beneficiary” forms. Assets titled jointly with “rights of survivorship” or in the name of a trust are also not probate property.

People who do not have a Will are often surprised to learn that their spouse will not inherit all of their property. Without a Will, your property will pass to your heirs in accordance with Georgia’s intestacy statutes. The law requires that the surviving spouse share the property equally with children regardless of age with the spouse getting at least a one-third share.

Additionally, the law makes no provision on how your heirs inherit your property. This is of particular importance for those with minor or spendthrift children. In that regard, parents can specify in their Will not only who will serve as Guardian of their children but they can also provide that a child’s inheritance will be received in trust. Such a trust may contain provisions that mirror a parent’s goals for such things as health and education. Parents may also specify the ages that their children receive their inheritance outright from the trust to ensure their children have attained the maturity needed to handle a large sum of money. Furthermore, a trust can serve to protect children with creditor or marital problems.

A Will also allows you to specifically name who will fill the role of Executor, Trustee or Guardian. Otherwise, the court will have to make its best guess according to Georgia law. The spouse is typically the first preference which may not be your first choice, especially in the case of a second marriage.

A Will can also minimize the costs of probate and the level of probate court involvement. Probate is the process of proving your Will and empowering the Executor to administer the estate. Generally, Georgia law requires the Executor to post a bond and file annual reports, inventories and accountings. All of this will drive up the costs of probate and likely ensure that fees must be paid to an attorney or CPA to help complete and file the additional paperwork. These requirements can all be expressly waived in a properly drafted Will.

For those with an estate that is large enough to incur the dreaded estate tax (which is currently 35% but jumps to 55% in 2013), tax minimization is a primary goal. No one should pay more in taxes than the law requires. A Will can be drafted to minimize the impact of federal estate taxes to ensure that the federal government is not the major recipient of your estate. One common technique to minimize taxes is to create a Credit Shelter Trust or a Bypass Trust to shelter assets of the first spouse to die. If properly drafted, the trust assets will not be subject to estate tax upon the subsequent death of the surviving spouse.

While an apple a day may keep the doctor away, scientists have yet to discover a cure for our inevitable mortality. Drafting and preparing your estate plan, or reviewing an outdated estate plan, is essential to getting your affairs in order.

Thomas Sayers is an AV-rated attorney and a partner at Bart Meyer and Company, LLP. He may be reached at 598-5151.