Individuals in all walks of life may think about estate planning on occasion, casually discuss it with family or friends, or see an advertisement on TV. But many people, sadly, don’t consider taking real action.
Perhaps they simply believe they do not have the wealth they think is needed to take steps to create an estate plan. Maybe they feel it simply isn’t necessary because they are not married, have no kids or serious assets.
However, estate plans are important for everyone because we all have wishes we would like carried out in the event our untimely death – regardless of marital status, kids, or wealth.
Considering the following 3 documents can help ensure your wishes are granted when you pass away or become incapacitated:
Create a will
A will is one of the most important estate planning documents a person can create and it doesn’t have to be long or complex.
Creating a will can help you designate how your assets will get distributed and to whom. Perhaps you don’t have a luxury vacation home but you might have a cherished heirloom that has been in your family for many years. Sentimental value is assets is just as important as their fair market value.
If you have children, you can also use a will to appoint a guardian for them if you should suddenly become incapacitated or pass away.
If you die without a will, your assets may get distributed according to state law, which may not be in line with your wishes.
Designate a power of attorney
A power of attorney is a legal document that gives someone else the authority to make decisions on your behalf. This can be helpful if you become incapacitated and cannot make your own healthcare decisions.
If you have, for instance, specific beliefs or views on resuscitation or end of life care, you’ll want to create a power of attorney that authorizes a trusted individual to make these decisions.
Without it, a physician or next of kin may make a decision that you would not agree with.
A power of attorney isn’t solely reserved for healthcare decisions. You can execute a POA for your financial matters as well.
Select a trust
Creating a trust can be beneficial for many reasons.
Some opt to place assets in a trust to benefit another individual. A special needs trust is one example. Assets can be placed in the trust to provide financial support and services to a person, all while preserving eligibility for Medicaid or other government services. A trust an also be used to protect assets from creditors or lawsuits.
Estate planning doesn’t have to be complex. Reaching out to an estate planning attorney who can offer advice on how to get started is a good step to ensure wishes regarding your specific assets or beliefs are carried out.