Estate planning is often misunderstood or put off until “later.” In fact, a recent study found that 76% of Americans do not have a will. That’s an alarming statistic, considering that nearly every adult can benefit from some level of estate planning.
Even if you’re young or don’t own much property, having an estate plan provides peace of mind. It ensures your wishes—not the default rules of the state—determine what happens with your assets and responsibilities.
This estate planning FAQ guide will answer some of the most common questions about planning for your estate. We’ll explain how Montana estate laws affect you and why having a plan is so critical. Our goal is to give you clear, concise answers so you can protect your future and your family’s well-being.
Let’s dive into the frequently asked questions every adult in Montana should know about estate planning.
What Is Estate Planning
Estate planning is the process of arranging—before you die—how your money, property, and other assets will be managed or distributed upon death. In simpler terms, it means making a plan for your belongings and loved ones in case something happens to you. Good estate planning doesn’t only address cases of death. It can also address what happens if you become incapacitated and can’t make decisions for yourself.
An estate plan typically includes several legal documents and tools. Common components of an estate plan are wills, trusts, powers of attorney, and advance healthcare directives. Each of these plays a role in covering different aspects of your life and assets:
- A last will and testament specifies who should inherit your property and can name guardians for minor children.
- A trust can help manage assets during your life and after, and often sets conditions on an inheritance.
- A power of attorney appoints someone to handle financial or legal matters if you’re unable to.
- A living will (Advance Healthcare Directive) expresses your wishes for medical care if you can’t communicate.
Estate planning can range from very simple to quite complex, depending on your situation. For example, if you own a house, have savings, or have children, you will need a more detailed plan than someone with few assets and no dependents. The key is that estate planning is for everyone, not just the wealthy or elderly. It’s about making sure your wishes are known and followed, which ultimately provides security for you and your loved ones.
Essential Estate Planning FAQs
1. What is Considered Part of an Estate?
Your estate is essentially everything you own and even some things you owe. It includes all of your possessions, assets, and debts at the time of your death. This means an estate can encompass:
- Real estate: your home, land, or any other property.
- Personal property: vehicles, jewelry, furniture, electronics, and personal belongings.
- Financial assets: bank accounts, investments, retirement accounts, stocks, and life insurance (the payout from a life insurance policy can be part of your estate if no beneficiary is named).
- Business interests: if you own a business or are part of one, your share is an asset of your estate.
- Debts and liabilities: credit card balances, loans, mortgages, and other obligations are also part of your estate because they must be paid out from your assets before distribution to heirs.
Importantly, an estate includes both probate assets and non-probate assets. Probate assets are those that pass under the terms of your will (or under state law if no will exists). Non-probate assets pass automatically to a named beneficiary or joint owner and might not be subject to the probate court process. Examples of non-probate assets are life insurance with a beneficiary designation, jointly owned bank accounts with rights of survivorship, or retirement accounts with a beneficiary. These assets typically go directly to the named beneficiaries and aren’t controlled by your will.
Even if your estate is modest, you still have an estate, and you likely care about who will receive those items or how they’ll be managed. That’s why having a plan for all parts of your estate is so important.
2. What is the Difference between Estate Planning and a Will?
A will is one key component of an estate plan, but estate planning is a much broader process. Think of it this way: a will is a document, while estate planning is a strategy (often involving multiple documents). A will primarily addresses the distribution of your assets after death, whereas estate planning encompasses everything needed to protect your interests both during life and after death.
Here are the main differences:
- Last Will and Testament: A will is a legal document in which you (the testator) state who should receive your property when you die. You can also name an executor (called a Personal Representative in Montana) to manage your estate, and name guardians for minor children in your will. A will only takes effect upon your death. It has no power while you’re alive (other than reflecting your intentions for the future).
- Estate Planning: Estate planning is a comprehensive approach to handling your affairs. It includes writing a will and may also include creating trusts, designating powers of attorney, setting up healthcare directives, making beneficiary designations on accounts, planning for taxes, and more. For example, a complete estate plan will not only say who gets your money when you die, but also who can make financial or medical decisions for you if you’re incapacitated, who will care for your children if something happens to you, how to minimize taxes or court costs, and how to ensure a smooth transfer of assets.
In short, a will is a crucial part of an estate plan, but it’s not the entire plan. Estate planning is broader and more holistic. It’s the difference between having a single tool versus a full toolkit. A good estate plan uses a will plus other legal tools to make sure all aspects of your life and legacy are addressed according to your wishes. If you only have a will, you’ve taken an important step but might be leaving out other protections. Estate planning covers those “what ifs” as well, not just what happens when you die.
3. When Should I Make an Estate Plan?
It’s never too early to create an estate plan, but it can become too late. So the best time to make or update your estate plan is right now. Once it’s done, you’ll likely feel relieved knowing this important task is checked off your list. Here are some guidelines on timing:
- Early Adulthood: If you’re over 18, you’ve reached the age where no one (not even your parents) can automatically make decisions for you. So even young adults benefit from at least a minimal estate plan.
- After Major Life Events: Ideally, you should create an estate plan once you acquire assets or have a family to protect. Key milestones that should prompt you to create or update an estate plan include:
- Getting married (or entering a committed long-term partnership).
- Birth or adoption of a child (to name guardians and provide for them).
- Buying a home or any real estate.
- Starting a business.
- Coming into an inheritance or other significant assets.
- Divorce or remarriage (estate plans need updates to reflect these changes).
- Major changes in financial status (good or bad).
- Serious illness or receiving a troubling health diagnosis.
- During Good Health and Clear Mind: It’s much better to tackle estate planning when you’re in a steady state of mind rather than during a crisis. If you wait until you are older, ill, or facing surgery, you’ll be under stress and time pressure. Planning with a clear head allows you to think through decisions carefully and discuss them with your family or attorney without urgency.
In Montana (as in most places), you must be of sound mind to sign estate planning documents, so doing it sooner ensures that competency is never in question. Also, remember that estate planning is not a one-time event. You should review your estate plan periodically (many experts suggest every 3-5 years, or whenever a major life event occurs) and update it to reflect your current wishes and circumstances.
4. Who Needs an Estate Plan?
Everyone who is an adult should have an estate plan, even if it’s a very basic one. Estate planning is not just for the wealthy, elderly, or those with complicated assets. Here’s why virtually everyone needs some form of estate plan:
- You Have Assets (Even Small Ones): If you have any money in the bank, a car, personal possessions, or anything of value, you have an estate. Even a modest checking account or a few personal treasures should go to the people you choose. An estate plan ensures those assets, big or small, end up where you want. Without a plan, state law will decide who gets what, which may not align with your wishes (and can cause family friction).
- You Have Children or Other Dependents: If you have minor children, they are relying on you to plan for their future in case you’re not there. Parents absolutely need an estate plan to name a guardian for their children and to set up financial protection (like a trust or custodial account) for the child’s inheritance. The same goes for anyone who has a dependent with special needs or an elderly parent they support. Your plan can make provisions for their care.
- You Care About Specific Wishes: Almost everyone has opinions about what should happen with their stuff or their body if something happens to them. These personal wishes can only be known and honored if you write them down. Without an estate plan, these decisions may be made by distant relatives or the courts with no input from you.
- Avoiding Unintended Consequences: Montana estate planning is important even for those with modest means because it prevents unintended results. For example, without a will or beneficiary designations, your assets might go to a relative you haven’t spoken to in years while a close friend or favored charity gets nothing. An estate plan fixes these issues by clearly stating who should inherit and what each person should receive.
- Business Owners or Farmers/Ranchers: If you own a small business or family farm, an estate plan is crucial to decide what happens to that enterprise. Without planning, a business can flounder or become the source of conflict among heirs. Estate planning can include a succession plan for the business or provisions to ensure a fair distribution
- Even Young Singles: As mentioned earlier, young adults often overlook estate planning. But even an 18-year-old should at least have basic healthcare directives (so someone can make medical decisions in an emergency) and consider a power of attorney for finances if they are incapacitated.
Remember that without an estate plan, Montana law will apply a one-size-fits-all plan for you, which may not reflect your unique situation or values. Given that the majority of Americans haven’t done any estate planning, simply getting yours done already puts you ahead of the curve in protecting your loved ones.
5. What is Probate?
Probate is the legal process of settling a person’s estate after death. It ensures debts are paid and assets are properly distributed. In probate, a court oversees the gathering of the deceased’s assets, the payment of any debts and taxes, and then the distribution of the remaining assets to the rightful heirs or beneficiaries. Here are the key points about probate:
- Validate the Will: If there’s a will, the court confirms it and appoints the executor (called a Personal Representative or PR in Montana). If no will exists, the court appoints a PR based on intestacy laws.
- Appoint a Personal Representative: The PR handles all estate matters—gathering assets, protecting them, and overseeing distribution.
- Notify Heirs and Creditors: The PR must inform heirs, beneficiaries, and creditors, giving creditors time to submit claims.
- Inventory and Appraise Assets: All estate assets (real estate, accounts, property, etc.) are listed. Some may require appraisal to determine value at death.
- Pay Debts and Taxes: Estate debts, funeral expenses, and taxes are paid from estate funds. If assets are insufficient, payments follow a legal priority.
- Distribute Remaining Assets: After obligations are met, assets go to beneficiaries (via the will) or heirs (by Montana’s intestacy law).
- Close the Estate: The PR files a final report and seeks court approval to close the estate..
In Montana, the probate process can be informal or formal. Informal probate is simpler and involves less court supervision; it’s often used when estates are straightforward and uncontested. Formal probate involves more court oversight and hearings; it might be needed if there are disputes, unclear aspects of the will, or other complexities. Montana’s adoption of the Uniform Probate Code (UPC) means our probate process is relatively modern and streamlined compared to some states.
6. What Happens if I Die without a Will?
If you pass away without a will, Montana’s intestacy laws decide how your assets are divided. This typically means your closest relatives—like your spouse or children—inherit your estate in a predetermined order, regardless of your personal wishes.
7. What is a Power of Attorney?
A power of attorney (POA) is a legal document that allows someone you trust to make decisions for you if you become unable to do so. In Montana, this can cover financial matters, healthcare choices, or both. Establishing a POA is an essential part of estate planning because it avoids court involvement and ensures your affairs are handled by someone you choose.
8. Who Should I Contact to Start Estate Planning?
It’s smart to work with a Montana estate planning attorney who understands state laws and can tailor a plan to your specific needs. At LHMG, we help clients across Montana create clear, enforceable plans. Whether you’re planning for your family, business, or future health care, we’ll guide you through each step with clarity and respect.
How Luebeck, Hammar, McCarty & Goldwarg Can Help with Estate Planning
At Luebeck, Hammar, McCarty & Goldwarg (LHMG), we understand that estate planning can feel overwhelming, but our goal is to make it accessible and tailored to your needs. As a Bozeman-based law firm with deep roots in Montana, we have experience with Montana estate laws, probate procedures, and the unique needs of local families. We’ve helped individuals and families across Southwest Montana create plans that give them security and peace of mind.
Secure Your Future: Contact LHMG for a Consultation
Contact Luebeck, Hammar, McCarty & Goldwarg today to schedule an estate planning consultation. Our knowledgeable Montana estate planning attorneys are ready to guide you through the process with care and expertise. We’ll help you understand your options and craft a plan that truly protects your future and reflects your values.
