“Every individual needs some form of an estate plan to protect their wishes and loved ones. Your estate consists of everything that you own (aka your assets), and although death may seem far away, it is never too soon to get your estate plan in order.”
Estate planning is preparing for two things: incapacity and death. It includes making sure you’ve conveyed your wishes about medical care in the case of a serious or terminal illness, who you want to receive your possessions when you pass and a series of documents to tell your loved ones your wishes. A recent article from The Street, “Everyone Needs an Estate Plan,” explains how to make this happen.
The foundation of the estate plan is your will, aka Last Will and Testament. It’s used to name several individuals for key roles. One is a guardian for minor children—if you don’t have a will or fail to name a guardian, a court will decide who should raise your children. Another is the executor, the person who will be in charge of overseeing your estate and your instructions. If you have animal companions, you may name a person to be their caretaker. However, you may want to go a step further and create a pet trust to provide funds for their maintenance.
You’ll also want a Living Will. This is a document conveying your wishes, if you are no longer able to make healthcare decisions for yourself. It focuses on end of life care. Do you want to be kept alive with artificial means, and if so, which ones are acceptable? How would you want pain management to be handled? Do you want to donate your organs? Yes, it’s a little scary, but imagine your loved ones in a highly emotional state having to guess what you would have wanted. It’s better for you and your family to know what you would want.
A personalized Power of Attorney. Naming a person as a Power of Attorney lets them handle your financial affairs and act as your agent or representative. However, here’s a pitfall: using a standardized form can lead to trouble. You may want your POA to be able to manage your day-to-day finances, but there may be some things you’d prefer them not to do. A customized POA can be as broad or as narrow as you wish.
Healthcare Power of Attorney and HIPAA Authorization. Information and decision making about healthcare today is complicated. Your representatives will need to have these documents to speak with your medical care providers, to make decisions and to gain access to your medical records. Without a HIPAA form, you won’t be able to see their medical records, even if you are a sibling or spouse. It’s best to have these documents in place long before they are needed.
The laws about these and other estate planning documents vary from state to state. Therefore, you’ll need to work with an experienced estate planning attorney in your area to make sure that all of your documents are valid. If you own a business or have a complex financial situation, there are many legal methods to protect your assets and convey them to your heirs.
Reference: The Street (Nov. 22, 2021) “Everyone Needs an Estate Plan”