The Basics of Estate Planning
There are some standards elements of estate planning that you may want to consider before meeting with your estate law attorney. No matter the size of your estate, large or small, a basic estate plan, which may be as simple as a Will, is a good idea. By looking toward the future, you can ensure that your finances are secure and you have put in place plans to help care for your family and loved ones, and made your wishes known.
There are several elements to an estate plan, including a will, assigning who will be given the power of attorney, if needed, and a health care plan, which may include a living will or designating someone to have medical power of attorney on your behalf. You may also wish to consider setting up one or more trusts.
Will. Your will designated what happens to your assets – your insurance policy, retirement savings, real estate holding and any investments, when you are no longer alive. Your will dictated who will inherit your assets, and will designate the guardians for any minor-age children you may have.
Financial Power of Attorney. If you become mentally incapacitated due to an accident or illness, your financial decisions will need to be overseen by someone who can make decisions on your behalf.
Medical Power of Attorney. If you become mentally incapacitated due to an accident or illness, your medical decisions and care plan will need to be overseen by someone who can make decisions on your behalf.
Trust. While may think of a trust as something only put into place by the very wealthy, in truth, a trust is a legal mechanism that allows you to place conditions on how and when specific assets can be distributed when you die. A trust also will allow you to lower the amount of estate and gift takes you pay, and is a way to distribute your assets to any heirs you may have. A trust may also be put into place to offer protection of some of your assets from lawsuits and creditors.
Take some time to inventory your assets, including business interests, real estate holdings, insurance policies, and retirement fund. Consider how you would like your assets distributed. Work with an experienced estate planning attorney to designate both financial and medical Powers of Attorney, and map out what health care proxy or living will specifics are important to you.